The rupee on Friday strengthened by 17 paise to close at 86.95 against the US dollar in the interbank foreign exchange market. The rupee gained due to the US dollar index falling to a five-month low and the fall in crude oil prices on expectations of a decline in demand.
However, foreign exchange traders say that the domestic currency remained under pressure due to volatility in the domestic stock market and continuous withdrawal of foreign funds. They said that the withdrawal of foreign institutional investors is due to increased risk aversion due to uncertainty over tariffs around the world.
The rupee opened at 87.13 in the interbank foreign exchange market and fell to a low of 87.22 per dollar during trading. Later the rupee strengthened to 86.88 per dollar and closed at 86.95 per dollar at the end of trading, which is 17 paise stronger than its previous close price.
Global oil benchmark Brent crude rose 2 per cent to $ 70.85 per barrel in futures trading. However, it is still at a six-month low. HDFC Securities research analyst Dilip Parmar said the Indian rupee recorded its biggest weekly gain since March 2023 due to a fall in the dollar index.
Parmar said strong government bonds, the central bank’s cash-raising measures and low crude oil prices have supported the rupee in the last few days. He said the spot price of the dollar: rupee is likely to remain between 86.40 and 87.70 in the near future. All eyes will be on the retail inflation and trade balance data to be released next week, which can further support the rupee’s rise.
In the domestic stock market, the 30-share BSE Sensex slipped 7.51 points to close at 74,332.58, while the Nifty rose 7.80 points to close at 22,552.50. According to stock market data, foreign institutional investors (FIIs) were net sellers in the capital market. He sold shares worth Rs 2,035.10 crore on Friday.
