The rupee appreciated by 3 paise to close at 82.37 (provisional) against the US dollar on Monday, as a positive trend in domestic equities and a weak dollar supported investor sentiments.
At the interbank foreign exchange market, the local unit opened at 82.36 against the American currency and finally settled at 82.37 (provisional) against the greenback, registering a gain of 3 paise over its previous close of 82.40.
During the trading session, the rupee touched a high of 82.27 and a low of 82.42 against the dollar.
The dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.02 per cent to 103.09.
Global oil benchmark Brent crude futures advanced 0.68 per cent to USD 75.50 per barrel.
According to Anuj Choudhary – Research Analyst at Sharekhan by BNP Paribas, the Indian rupee
appreciated amid positive domestic markets and a soft Dollar. However, positive crude oil prices capped sharp gains.
“We expect Indian Rupee to trade with a slight negative bias on month end Dollar demand from importers and sustained FII outflows. Worries over credit crunch in the US and Europe due to the banking crisis may lead to risk-off sentiments,” Choudhary said.
Choudhary further noted that renewed geopolitical tensions on Russia’s nuclear threat may lead to safe-haven demand for the dollar.
“We expect USD/INR spot price to trade in a range of Rs 81.80 to Rs 82.80 in the near term,” Choudhary added.
On the domestic equity market front, the 30-share BSE Sensex advanced 126.76 points or 0.22 per cent to end at 57,653.86, while the broader NSE Nifty rose 40.65 points or 0.24 per cent to 16,985.70.
Foreign Institutional Investors (FIIs) were net sellers in the capital market on Friday as they offloaded shares worth Rs 1,720.44 crore, according to exchange data.
Meanwhile, India’s forex kitty rose USD 12.798 billion to USD 572.801 billion in the week ended March 17.
In the previous reporting week, the reserves had dropped USD 2.39 billion to a three-month low of USD 560.003 billion.