Forex

Rupee settles 11 paise higher at 72.51 against USD

PTI Mumbai | Updated on March 26, 2021

The rupee snapped its three-day losing streak and closed 11 paise higher at 72.51 against the US dollar on Friday, supported by positive domestic equities and weakening of the American currency in the overseas market.

At the interbank forex market, the local unit opened at 72.51 against the greenback and witnessed an intra-day high of 72.37 and a low of 72.53.

It finally ended at 72.51, registering a rise of 11 paise over its previous closing. On Thursday, the rupee had settled at 72.62.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.14 per cent to 92.71.

"Next week is a truncated week with currency holidays, so we can expect market participation to be muted. At this point forex market is trying to get some more global news that will be the next catalyst.

"So, unless any nation stops the vaccine rollout, the rapid vaccination drive by the US will keep the risk appetite higher," said Rahul Gupta, Head Of Research- Currency, Emkay Global Financial Services.

However, lockdown in Europe and upbeat US data will limit any fall in USD-INR spot. Thus, we expect the spot to trade within 72.20-72.80, Gupta added.

Brent crude futures, the global oil benchmark, rose 2.10 per cent to USD 63.25 per barrel.

On the domestic equity market front, the BSE Sensex ended 568.38 points or 1.17 per cent higher at 49,008.50, while the broader NSE Nifty advanced 182.40 points or 1.27 per cent to 14,507.30.

Foreign institutional investors were net sellers in the capital market as they offloaded shares worth Rs 3,383.60 crore on Thursday, according to exchange data.

"The Indian rupee snapped a three-day slump to track higher Asian peers as better-than-expected US economic data weighed on dollar index," said Dilip Parmar, Research Analyst, HDFC Securities.

Rupee took cues from the turnaround in US sentiment and weaker dollar. With financial year-end adjustment completed today, the trend in currency will be decided by dollar inflows and by domestic cases of infections, Parmar added.

Meanwhile, the International Monetary Fund (IMF) has said that India's economy is on the path of gradual recovery.

According to Sriram Iyer, Senior Research Analyst at Reliance Securities, the Indian rupee appreciated on Friday amid greenback sales by exporters.

"The capital market recovered in the last couple of sessions giving the confidence back to the FIIs in investment in Indian markets coupled with a drop in Crude prices helping the rupee strengthen beyond 72.50 now. Going ahead 72.25 -72.75 will be the range for the rupee," said Jateen Trivedi, Senior Research Analyst at LKP Securities.

On a weekly basis, the rupee ended on a flat note, higher by just 1 paisa.

"For the week the currency remained flat against the US currency as FPI flows and greenback sales offset the broad strength in the dollar," Iyer said.

The forex market will remain closed on Monday for Holi.

Published on March 26, 2021

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