The Indian rupee strengthened by 11 paise to close at 83.46 (provisional) from the dollar on Monday on the back of positive global sentiment about domestic stock markets and steady international oil prices, which helped the INR vs USD chart. The forex traders pointed out other factors that helped the rupee bolster its strength, citing the sluggishness of the dollar against other key competitors overseas.
Nevertheless, marginal improvements were achieved because of the declining Asian markets and emerging geopolitical conflicts in the Middle East. Similarly, the interbank foreign exchange market opened at 83.52 and reached the day’s high of 83.44 against the greenback during the session. It eventually stabilized at 83.46 (provisional) against the dollar, up 11 paise from its previous close.
The rupee dipped to 83.63 on Friday, but it finally reached 83.57 against the dollar. On the other hand, the dollar index measures the greenback’s performance against other global currencies, including the Euro, which stood at 105.57, down by 0.21 percent. The actual movement in the INR vs USD exchange rate that was seen on Monday could also be due to several reasons, such as domestic equities and global oil prices. Brent crude futures, the global oil benchmark, rose by 0.36% to USD 85.55 per barrel has helped give the rupee some stability against the dollar.
In the domestic equity market, the 30-share BSE Sensex edged higher by 131.18 points or 0.17 percent; they closed at 77,341.08 points. Consequently, the larger NSE Nifty also advanced and ended the period 36.75 points, or 0.16 percent, which stood at 23,537.85 points. These shares promoted the rupee since they helped mobilize foreign exchange that pumps up the demand for the local currency.
However, there are a few factors that might be of concern to the bulls. One of them is that FIIs were net selling in capital markets on Friday to the tune of Rs. 1,790.19 crores as per the data available from exchanges.
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