Mumbai: The rupee opened steady against the US dollar in early trade on Tuesday, influenced by subdued domestic equities and the strength of the American currency in global markets.
Forex analysts attributed the dollar’s firmness to heightened demand from oil importers and robust economic indicators from the US. Additionally, elevated crude oil prices exerted pressure on the domestic currency.
In the interbank foreign exchange market, the rupee traded within a narrow band, opening at 83.49 against the dollar and touching 83.50 in initial trading.
Yesterday, the rupee closed weaker by 10 paise at 83.50 against the US dollar.
Amit Pabari, Managing Director at CR Forex Advisors, noted that the Reserve Bank of India’s optimistic economic outlook, with steady growth and unchanged inflation forecasts, suggests limited scope for near-term rate cuts, thereby supporting the rupee through favorable interest rate differentials.
Foreign Institutional Investors (FIIs) resumed buying in the capital markets on Monday, acquiring shares worth Rs 2,572.38 crore, as per exchange data.
Pabari highlighted anticipated inflows, including Reliance Infrastructure’s USD 350 million raise, SpiceJet’s USD 250 million plan, and Clix Capital’s USD 600 million aim, as potential boosts for the rupee.
Given these factors, Pabari expects the rupee to fluctuate within a range of 82.90 to 83.70.
Meanwhile, the dollar index, measuring the greenback against a basket of major currencies, stood at 105.12, marginally lower by 0.02%.
Brent crude futures, the global benchmark, declined 0.20% to USD 81.47 per barrel.
In the domestic stock market, the BSE Sensex traded 155.45 points lower at 76,334.63 points, while the NSE Nifty was down 33.25 points at 23,225.95 points.
