The rupee strengthened on the back of fall in crude oil prices and continued inflow of foreign funds into the capital market.
The rupee had fallen to a low of 80.06 last month. Since then there has been a decent improvement in the last four seasons. The reason for this is the return of foreign institutional investors to the capital market again and crude oil prices coming down below $100 a barrel.
Indications for a softer stance by the US Federal Reserve on raising policy rates improved risk appetite and strengthened rupee sentiment.
The rupee has gained 138 paise or 1.73 per cent against the US dollar in the last four days till Tuesday.
In the interbank foreign exchange market, the rupee opened with strength at 78.96.
At one point of time the rupee remained at a high of 78.49 and a low of 78.96 during trading. But at the end of trading, the rupee gained 53 paise to close at 78.53 per dollar. Earlier on June 27, the rupee had closed around this level.
Jatin Trivedi, Vice President, Research Analyst Division, LKP Securities said, “The rupee climbed higher above 78.50 on weakness in the dollar index and crude oil prices falling below USD 95 in West Texas Intermediate (WTA). Rupee range can be seen between 78.45 to 78.85.
Due to this, the rupee had closed at Rs 79.06 per dollar on Monday in the previous trading session.
Meanwhile, the dollar index, which measures the dollar’s strength against the world’s six major currencies, rose 0.10 per cent to 105.55.
International oil benchmark Brent crude fell 0.38 percent to $99.65 a barrel.
Foreign Institutional Investors (FIIs) were buying in the Indian market. According to available data, foreign investors bought shares worth a net Rs 825 crore on Tuesday.
Source: navbharattimes.indiatimes.com
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