On Tuesday, the Indian rupee rose 10 paise to close at 85.82(provisional) against the US dollar on the wobbling greenback in the international markets and the low prices of international crude oil. The currency had earlier settled at 85.92 on Monday, representing a 12-paise depreciation.
The rupee opened at 85.97 and traded confined to a narrow range of 85.75-85.97 to finally close stronger at the interbank foreign exchange market at 85.82. The rising global dollar softness and the decline in Brent crude prices to USD 68.91 a barrel, representing 0.43 per cent depreciation in futures trade, were attributed to the dollar by forex traders to cause an increase in the gains of the rupee.
Nevertheless, the rupee gained despite being capped due to the outflow of foreign funds and worries over the alleged result of the ongoing India-US trade talks. A top-level Indian commerce department team is in Washington, and this is part of a four-day negotiation where they are trying to iron out certain details of the proposed bilateral trade agreement (BTA). These negotiations started on Monday and will end on Thursday.
The dollar index that shows the strength of the greenback against the six major currencies plunged 0.11 per cent to 97.97, boding well for the emerging market currencies such as the rupee.
Indian stock markets are out on the positive front in the domestic equity sector. The Sensex index of BSE closed the day at 82,570.91 with a 317.45 points gain, and the Nifty index of NSE closed with a 25,195.80 points gain on 113.50 points.
But foreign institutional investors (FIIs) remained as net sellers as they sold equities worth 1,614.32 crore on Monday, as exchange data indicated.
In the meantime, official data issued on Tuesday show that India managed to maintain merchandise exports during the month of June unchanged in comparison to the previous months, as exports reached USD 35.14 billion, and the trade deficit is reported to be USD 18.78 billion.
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