Rupee Rises Against US Dollar: Trade Talk Impact

Mumbai, Sep 26 (PTI) The rupee rebounded from its all-time low to close 4 paise higher at 88.72 (provisional) against the US dollar on Friday, tracking a weak greenback against major currencies overseas and a drop in global crude oil prices.

Unabated foreign capital outflows and risk-off sentiment in the domestic equity market prevented a sharp rise in the local unit, while hopes of a breakthrough in the India-US trade talks supported the domestic currency, according to forex traders.

At the interbank foreign exchange, the rupee opened at 88.72 and traded in a narrow range of 88.67-88.73 before settling at 88.72 (provisional), 4 paise higher than its previous close.

The rupee had slipped 1 paisa to close at a fresh lifetime low of 88.76 against the American currency on Thursday.

"The Reserve Bank of India seems to have intervened heavily in the morning, allowing an opening of 88.68 for the rupee...Tariffs have been responsible for the constant fall in indices and rupee with Trump imposing 100 per cent tariffs on pharma, furniture and trucks," Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP, said.

The rupee is expected to remain in the range of 88.50-89.00 on Monday, he added.

Meanwhile, India and the US have decided to continue their engagements to achieve an early conclusion of a mutually beneficial trade pact, according to the Commerce Ministry.

Commerce and Industry Minister Piyush Goyal led a delegation of officials to the US for the three-day trade talks earlier this week.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.19 per cent lower at 98.37.

Brent crude, the global oil benchmark, was trading 0.39 per cent higher at USD 69.15 per barrel in futures trade.

On the domestic equity market front, Sensex tanked 733.22 points to settle at 80,426.46, while Nifty was down 236.15 points to 24,654.70.

Foreign Institutional Investors offloaded equities worth Rs 4,995.42 crore on Thursday, according to exchange data.