Rupee rises 9 paise to close at 82.31 against U.S. dollar

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| Photo Credit: NAGARA GOPAL

The rupee appreciated by 9 paise to 82.31 (provisional) against the U.S. dollar on June 2, supported by broad dollar weakness and a positive trend in domestic equities.

At the interbank foreign exchange market, the local unit opened on a positive note against the U.S. dollar and settled at 82.31 (provisional), up 9 paise over its previous close.

During the day, the domestic unit witnessed an intra-day high of 82.27 and a low of 82.38 in the day trade.

On Thursday, the rupee closed at 82.40 against the U.S. currency.

“The Indian rupee strengthened for the second consecutive day on positive domestic markets and a weak US dollar. However, a rebound in crude oil prices capped sharp gains,” said Anuj Choudhary – Research Analyst, Sharekhan by BNP Paribas.

The dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.12% to 103.43.

Global oil benchmark Brent crude futures advanced 1.28% to $75.23 per barrel.

“We expect rupee to trade with a slight positive bias in the near term on risk-on sentiments in the global markets amid debt-ceiling bill being passed and rising odds of a pause in rate hike by the US Federal Reserve in June,” Choudhary said.

Choudhary further added that concerns over global economic slowdown and recovery in crude oil prices may prevent sharp upside.

“Traders may remain cautious ahead of US non-farm payrolls and unemployment rate data. We expect USDINR spot to trade in between 81.80 to 82.80 in the near-term,” Choudhary said.

Besides, positive macroeconomic data supported the local unit, traders said.

According to official data released on Thursday, GST collections crossed ₹1.50 lakh crore for the third month in a row, recording a 12 per cent increase in May at over ₹1.57 lakh crore.

Moreover, manufacturing activities in India advanced further and touched a 31-month high in May supported by stronger increase in new orders and favourable market conditions.

The seasonally adjusted S&P Global India Manufacturing Purchasing Managers’ Index (PMI) rose from 57.2 in April to 58.7 in May.

On the domestic equity market front, the 30-share BSE Sensex advanced 118.57 points or 0.19% to end at 62,547.11 points, and the broader NSE Nifty rose 46.35 points or 0.25% to 18,534.10 points.

Foreign Institutional Investors (FIIs) were net sellers in the capital market on Thursday as they offloaded shares worth ₹71.07 crore, according to exchange data.