Rupee Rises 7 Paise To Close At 72.68 Against US Dollar

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The dollar index fell 0.15 per cent to 90.34.

The rupee gained 7 paise to settle at 72.68 (provisional) against the US dollar on Monday supported by positive macroeconomic data and a firm trend in domestic equities.

At the interbank forex market, the local currency opened at 72.61 against the greenback and witnessed an intra-day high of 72.57 and a low of 72.69. It finally ended at 72.68 against the American currency — registering a rise of 7 paise from its previous close. On Friday, the rupee had settled at 72.75 against the American currency. The dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.15 per cent to 90.34.

On the domestic macroeconomic front, indicating some signs of recovery, industrial production recorded a positive growth of 1 per cent in December while retail inflation cooled to a 16-month low of 4.06 per cent in January. “The appreciation in the rupee is primarily due to RBI intervention, positive comments by rating agency Moody’s on India’s economic outlook, record fund flows in Indian equities by FIIs,” said Nish Bhatt, founder & CEO, Millwood Kane International. Bhatt further said that the rally in crude prices, a hope of an extra stimulus package from the US government, and the policy stance of the US Fed to keep rates low for a longer duration of time has kept the dollar lower.

“Moving forward RBI’s action via OMO to support the rupee, global economic recovery, and vaccination process will guide the INR/USD movement,” he noted.

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On the domestic equity market front, the BSE Sensex ended 609.83 points or 1.18 per cent higher at 52,154.13, while the broader NSE Nifty advanced 151.40 points or 1 per cent to 15,314.70. Foreign institutional investors (FIIs) were net sellers in the capital market as they offloaded shares worth Rs 37.33 crore on Friday, according to exchange data. Brent crude futures, the global oil benchmark, rose 1.23 per cent to $63.20 per barrel.

The domestic currency is likely to strengthen 1.3 per cent and average 73.5 against the US dollar in the financial year 2022-23 compared with an average level of 74.4 in the financial year 2021-22.



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