The rupee strengthened by 32 paise to reach 83.01 against the US dollar in morning trade on Wednesday, benefiting from the dollar’s retreat following lower-than-expected US inflation. The positive momentum was bolstered by a bullish opening as the US currency weakened, marking its lowest inflation level since September 2021. Domestic equities also contributed to the upbeat investor sentiment.
Beginning at 83.03 at the interbank foreign exchange, the rupee reached 83.01 against the US dollar, a 32 paise gain from the previous close. The previous day, the rupee had declined by 5 paise, settling at an all-time low of 83.33 against the US dollar. Tuesday saw the closure of forex and equity markets due to Diwali-Balipratipada. Recovering from last week’s all-time low amid system issues, the rupee is currently trading at nearly a two-month high around 83.00 levels.
Analysts suggest that a breakdown below 82.95 may push the pair towards 82.80 and 82.50 levels in future sessions. Concurrently, the dollar index marginally increased by 0.02% to 104.07, compared to Monday’s 105.77. Global oil benchmark Brent crude futures experienced a 0.35% uptick, reaching USD 82.76 per barrel.
In the domestic equity market, the BSE Sensex rose by 598.53 points or 0.92% to 65,532.40 points, while the NSE Nifty climbed 184.85 points or 0.95% to 19,628.40 points. Foreign Institutional Investors (FIIs) were net sellers on Monday, offloading shares worth Rs 1,244.44 crore, according to exchange data. The complex interplay of factors, including global economic indicators and market dynamics, continues to shape the trajectory of the rupee against the US dollar.
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