Rupee gains 18 paise to 85.56 against US dollar on strong foreign inflows
According to forex dealers, foreign investors have injected over USD 2 billion into Indian equities over the past four days, while month-to-date inflows into Indian bonds have surpassed USD 3 billion. However, the local currency's sharp appreciation remained limited as investors weighed the potential economic impact of rising global trade concerns.
Mumbai: The rupee appreciated 18 paise to 85.56 against the US dollar in early trade on Friday, as sustained foreign fund inflows provided support to the local unit.
Forex dealers said over the past four days, foreign investors have pumped over USD 2 billion into Indian equities, while month-to-date inflows into Indian bonds have exceeded USD 3 billion.
However, sharp upside for the local unit was restricted as investors grappled with the potential economic impact of growing global trade concerns.
At the interbank foreign exchange, the rupee opened at 85.64 against the greenback, then touched 85.56, up 18 paise from its previous close.
On Thursday, the rupee had weakened by 5 paise to close at 85.74 against the US dollar.
According to Anil Kumar Bhansali, Head of Treasury and Executive Director Finrex Treasury Advisors LLP, the USD/INR pair is expected to trade in a range of 85.60/86 as today’s session will be the last session of the week, month, quarter and year.
“There is a host of data to be released on March 31, which is otherwise a holiday, particularly the current account data of the last quarter. Exporters wait for better levels to sell,” he added.
Moreover, global risk sentiment got affected as escalating trade tensions resurfaced after US President Donald Trump signed an order imposing 25 per cent tariff on auto imports.
Meanwhile, the US dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.03 per cent lower at 104.30.
Brent crude, the global oil benchmark, was trading 0.08 per cent lower at USD 73.97 per barrel in futures trade.
In the domestic equity market, the 30-share BSE Sensex was trading 165.16 points, or 0.21 per cent, lower at 77,441.27 points, while the Nifty was down 41.55 points, or 0.18 per cent, at 23,550.40 points.
Foreign institutional investors (FIIs) purchased equities worth Rs 11,111.25 crore on a net basis on Thursday, according to exchange data.
