Rupee rises 4 paise to close at 83.95 against U.S. dollar

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The rupee traded in a narrow range to settle 4 paise higher at 83.95 (provisional) against the U.S. dollar on Thursday (September 12, 2024) amid a positive trend in domestic equities and foreign fund inflows.

Forex traders said the rupee trade was range-bound, with a slight positive bias toward positive domestic equities. However, a rebound in the U.S. Dollar and a surge in crude oil prices capped sharp gains.

The USD/INR pair traded within a well-defined range on active intervention by the Reserve Bank of India (RBI), they added.

At the interbank foreign exchange market, the local unit opened at 83.97 and witnessed an intraday high of 83.95 and a low of 83.99 against the American currency.

The domestic unit finally settled for the day at 83.95 (provisional), higher by 4 paise over its previous close.

On Wednesday (September 11, 2024), the rupee settled 1 paisa lower at 83.99 against the American currency.

“We expect the rupee to trade with a slight negative bias on the positive U.S. Dollar and a recovery in crude oil prices. However, a rise in risk appetite in global markets may support the rupee. Any intervention by the RBI may support the rupee at lower levels,” said Anuj Choudhary – Research Analyst at Sharekhan by BNP Paribas.

Mr. Choudhary further noted that traders may take cues from India’s CPI data and European Central Bank (ECB) monetary policy. Investors may remain cautious ahead of the U.S. Federal Open Market Committee (FOMC) meeting next week.

Forex traders said risk sentiment has improved after the U.S. August CPI data. The U.S. headline CPI came in lower than expectations at 2.5% year-on-year. Core CPI came in line with expectations at 3.2%.

The stability in the U.S. CPI data helped the dollar index maintain its current levels.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was up 0.06% to 101.74 points.

Brent crude, the international benchmark, gained 1.71% to $71.82 per barrel in futures trade.

In the domestic equity market, the 30-share BSE Sensex advanced 1439.55 points, or 1.77%, to close at 82,962.71 points, while the Nifty climbed 470.45 points, or 1.89%, to 25,388.90 points.

Foreign Institutional Investors (FIIs) were net buyers in the capital markets on Wednesday, as they purchased shares worth ₹1,755.00 crore, according to exchange data.