Rupee Strengthens 4 Paise Against US Dollar

Mumbai, Dec 29 (PTI) The rupee appreciated 4 paise to settle at 83.16 against the US dollar on the last trading day of 2023, helped by a weak greenback against major rivals overseas and renewed foreign capital inflows amid lower crude oil prices.

However, subdued domestic equity markets and increased month-end dollar demand from importers restricted the rise in the domestic unit, traders said.

At the interbank foreign exchange on Friday, the domestic currency opened at 83.14, touched the peak of 83.10 and hit the lowest level of 83.22 against the greenback during intra-day deals. The local unit closed the session at 83.16 against the dollar, registering a gain of 4 paise over its previous close.

The domestic currency jumped 14 paise to 83.20 on Thursday.

The dollar index, which gauges the greenback's strength against a basket of six currencies, was trading lower by 0.13 per cent at 101.36 on Friday.

Anuj Choudhary, Research Analyst at Sharekhan by BNP Paribas, said the US dollar recovered slightly on short coverings but declined again on expectations of interest rate cuts by the US Federal Reserve.

The rupee is likely to trade with a slight positive bias on the weak tone of the US dollar and declining crude oil prices. Fresh foreign inflows may also support the domestic currency, he added.

"Month-end dollar demand from OMCs and importers may weigh on the rupee at higher levels. Traders may take cues from India's fiscal deficit and Chicago PMI data from the US. USD-INR spot price is expected to trade in a range of Rs 82.90 to Rs 83.50," Choudhary added.

Meanwhile, global oil price benchmark Brent crude climbed 0.89 per cent to USD 77.84 per barrel.

In the domestic equity market, the 30-share BSE Sensex declined 170.12 points or 0.23 per cent to settle at 72,240.26 points. The broader NSE Nifty fell 47.30 points or 0.22 per cent to 21,731.40 points.

Foreign Institutional Investors (FIIs) bought equities worth Rs 1,459.12 crore on Friday, according to exchange data.