Rupee Rises 4 Paise to 83.01 vs US Dollar

Mumbai, Feb 16 (PTI) The rupee rose 4 paise to settle at 83.01 against the US dollar on Friday, amid positive sentiment in the domestic equity markets and softening crude oil prices.

Forex traders said a strong American currency and outflow of foreign funds, however, capped a sharp gain in the domestic currency.

At the interbank foreign exchange market, the local unit opened at 83.03, and touched the intraday high of 83 against the greenback.

The local unit finally settled at 83.01 against the dollar, registering a gain of 4 paise from its previous close.

On Thursday, the rupee settled 3 paise lower at 83.05 against the US dollar.

According to Anuj Choudhary, Research Analyst, Sharekhan by BNP Paribas, the rupee appreciated on positive domestic markets.

The dollar index, which gauges the greenback's strength against a basket of six currencies, was 0.07 per cent higher at 104.36.

"The US dollar index recovered on declining expectations of a rate cut by the US Fed in March and May 2024. Economic data from the US was slightly disappointing for the greenback," Choudhary said.

He further said that the positive tone in the US dollar and concerns over foreign fund outflows may cap a sharp upside in the Indian currency. "USD-INR spot price is expected to trade in a range of Rs 82.80 to Rs 83.20."

Brent crude futures, the global oil benchmark, declined 1 per cent to USD 82.03 per barrel.

On the domestic equity market front, Sensex advanced 376.26 points, or 0.52 per cent, to settle at 72,426.64 points. The Nifty climbed 129.95 points, or 0.59 per cent, to 22,040.70 points.

Foreign Institutional Investors (FIIs) were net buyers in the capital markets on Friday as they bought shares worth Rs 253.28 crore, according to exchange data.

Jateen Trivedi, VP Research Analyst, LKP Securities, said strength in domestic markets provided positive support for the rupee.

"Overall, the rupee has been trading within the range of 82.80-83.25 for over two months now. With the RBI focused on maintaining rupee stability and India demonstrating strength compared to its peers, this trend is expected to continue," he added.

Government data released on Thursday showed the country's exports increased 3.12 per cent on-year to USD 36.92 billion in January. Imports rose by about 3 per cent to USD 54.41 billion and the trade deficit stood at USD 17.49 billion.