Mumbai, Jul 29 (PTI) The rupee climbed 6 paise to 95.76 against the US dollar on Wednesday, extending its gaining streak for the fourth straight session, amid hectic buying in domestic equity markets and lower global crude prices.
Foreign capital inflows and a weak American currency ahead of the US Federal Reserve’s interest rate decisions also supported the local unit, forex traders said.
At the interbank foreign exchange, the rupee opened at 95.70 and touched the intraday low of 95.80 against the greenback. The unit hit the day’s high of 95.48 before ending the session at 95.76 against the dollar, up 6 paise from its previous close.
The local currency settled 17 paise higher at 95.82 against the US dollar on Tuesday, after gaining 74 paise in the previous two back-to-back sessions.
Anuj Choudhary, Research Analyst, Mirae Asset ShareKhan, said the rupee gained on positive domestic markets and fresh FII inflows. A soft dollar also supported the rupee.
The US dollar has eased ahead of the FOMC (Federal Open Market Committee) meeting decision, Choudhary said, adding that, “USD-INR spot price is expected to trade in a range of Rs 95.20 to Rs 95.90”.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading down 0.04 per cent at 101.22.
Brent crude futures, the global oil benchmark, were trading 3.78 per cent higher, but remained lower at USD 87.27 per barrel.
According to Jateen Trivedi, VP Research Analyst – Commodity and Currency, LKP Securities, the rupee’s positive bias was supported by sustained buying in domestic equities and improving foreign investor sentiment, with FII flows remaining positive over the past few sessions.
“While most Asian peers remained under pressure amid caution surrounding the AI chip sector, Indian equity markets outperformed, providing additional support to the domestic currency, Trivedi said.
According to analysts, even as mediators tried to get the US and Iran back to negotiations and toward a ceasefire, crude oil prices rose overnight as the brief pause in fighting was shattered after the US military said that Iran launched multiple ballistic missiles at American forces on Tuesday.
All Iranian missiles were successfully intercepted, US Central Command said in a statement, adding that US forces “remain vigilant and at a high state of readiness”.
On the domestic equity market front, Sensex surged 888.68 points, or 1.16 per cent, to settle at 77,654.60, while the Nifty closed up 264.85 points, or 1.10 per cent, to 24,250.20.
Foreign Institutional Investors purchased equities worth Rs 2,981.87 crore on a net basis on Wednesday, according to exchange data.
On the macroeconomic front, the government data released on Tuesday showed the country’s industrial output rose by 7.3 per cent in June compared to 5.1 per cent in the preceding month on the back of improved manufacturing sector performance and strong growth of the electricity and gas supply sector.
The rupee is expected to take cues from crude oil prices, the US Dollar Index, FII flows, and global risk sentiment. Technically, the rupee is likely to trade in the 95.25-95.95 range over the near term, Trivedi said. PTI HVA BAL BAL
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