Rupee rises 12 paise to close at 95.58 against US dollar

The rupee appreciated 12 paise to close at 95.58 against the US dollar on Wednesday amid cautious investor sentiment over US-Iran tensions. Traders are now focusing on the upcoming RBI Monetary Policy Committee meeting scheduled from June 3 to 5

Mumbai: The rupee settled 12 paise higher at 95.58 against the US dollar on Wednesday, as renewed tensions between the US and Iran and delays in negotiations kept investors cautious.

Forex traders said a strong American currency and weak domestic markets also put pressure on the rupee. Attention has shifted towards the upcoming RBI Monetary Policy Committee meeting scheduled from June 3 to 5, they said.

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At the interbank foreign exchange market, the rupee opened at 95.60 against the US dollar and touched an intra-day low of 95.79 against the American currency.

At the close of trading on Wednesday, the rupee was quoted at 95.58, up 12 paise from its previous close.

On Tuesday, the rupee had depreciated 44 paise to close at 95.70 against the US dollar.

“We expect the rupee to trade with a negative bias on renewed tensions between the US and Iran and concerns over military action in the Middle East.

“However, softening crude oil prices may support the rupee at lower levels. USDINR spot price is expected to trade in a range of 95.50 to 96.10,” said Anuj Choudhary, Research Analyst at Mirae Asset ShareKhan.

The dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading at 99.07, down 0.10 per cent.

“Uncertainty around the Strait of Hormuz is keeping DXY well supported due to safe haven demand,” said Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP.

Brent crude, the global oil benchmark, was trading 3.02 per cent lower at USD 96.57 per barrel in futures trade.

On the domestic equity market front, the Sensex declined 141.90 points to settle at 75,867.80, while the Nifty dipped 6.55 points to 23,907.15.

Foreign institutional investors offloaded equities worth Rs 1,042.70 crore on Wednesday, according to exchange data.