Rupee rises 2 paise to close at 94.49 against US dollar

The rupee rose 2 paise to close at 94.49 against the US dollar on Friday, extending gains for a sixth straight session. Foreign inflows and improved risk appetite supported the currency, while crude prices and US-Iran tensions capped gains

Mumbai: The rupee settled for the day higher by 2 paise at 94.49 (provisional) against the US dollar on Friday, supported by optimism over rising foreign inflows and improved risk appetite.

Forex traders said the rupee was likely to strengthen due to robust foreign capital inflows and active RBI intervention.

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However, rising crude oil prices and escalating US-Iran geopolitical tensions may cap these gains.

At the interbank foreign exchange market, the rupee opened at 94.53 and touched an intra-day high of 94.46 and a low of 94.53 during the session.

At the end of Friday’s trading session, the rupee was quoted at 94.49 (provisional), higher by 2 paise from its previous close.

On Thursday, the rupee extended its gaining momentum for the fifth straight session, appreciating 22 paise to close at 94.51 against the US dollar.

“The Indian rupee gained on positive domestic markets. Foreign inflows and FII buying also supported the rupee,” said Anuj Choudhary, Research Analyst, Mirae Asset Sharekhan.

This was the sixth straight session of gains for the rupee. On Wednesday, the rupee settled at 94.73, recording a gain of 22 paise.

The local unit gained 27 paise to settle at 94.95 against the US dollar on Tuesday, after rising 21 paise and 2 paise in the preceding two sessions on Monday and Friday, respectively.

“We expect the rupee to trade with a positive bias on positive global markets and improved global risk sentiment. Foreign inflows and reduced expectations of a rate hike following dovish comments by Fed Governor Christopher Waller may also support the rupee.

“However, elevated crude oil prices and any fresh escalation of tensions between the US and Iran may cap sharp gains. Traders may take cues from the non-farm payrolls report from the US. USDINR spot price is expected to trade in a range of 94.15 to 94.75,” Choudhary added.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading at 99.11, higher by 0.21 per cent on safe-haven demand amid renewed US-Iran tensions.

Brent crude, the global oil benchmark, was trading 0.01 per cent higher at USD 95.53 per barrel in futures trade, amid escalating US-Iran tensions and fears of disruption to oil flows through the Strait of Hormuz.

On the domestic equities market front, the Sensex rose 362.57 points to settle at 76,515.43, while the Nifty was up 24.25 points at 23,897.70.

Foreign institutional investors (FIIs) offloaded equities worth Rs 2,345.87 crore on a net basis on Thursday, according to exchange data