Mumbai : The rupee rose by 3 paise to settle at 74.90 against US dollar on Monday tracking positive domestic equities.
The rupee traded in a narrow range as positive domestic equities and foreign fund inflows supported the rupee while strong US dollar and rise in crude oil prices weighed on the local unit, forex traders said.
At the interbank forex market, the rupee opened weak at 74.96. It moved to a day’s low of 74.96 before settling at 74.90 against the greenback, showing a gain of 3 paise over the previous close. The rupee had settled at 74.93 against US dollar on Friday.
The dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.17 per cent to 93.59.
On the domestic equity market front, the 30-share BSE benchmark Sensex pared some gains to end 141.51 points or 0.37 per cent higher at 38,182.08.The NSE Nifty climbed 56.10 points or 0.50 per cent to close at 11,270.15.
Foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 397.32 crore on Friday, according to provisional exchange data.
Brent crude futures, the global oil benchmark, rose 1.10 per cent to USD 44.89 per barrel.
Meanwhile, the number of cases around the world linked to COVID-19 has crossed 1.98 crore; and in India, the number of infections touched 22,15,074.
According to Devarsh Vakil, Deputy Head Retail Research, HDFC Securities, Indian rupee gained following expectation of dollar inflows. While, Dollar index extended Friday’s gains amid stronger US jobs data and President Donald Trump signing executive orders to ban some China tech firms.
“Rupee expected to trade in broad range as at one end the Axis Bank and HDFC Bank share sale inflows are to hit markets this week which could provide support to the rupee while recovery in dollar against major trading currencies and central bank’s intervention could restrict the gains,” Vakil said.
Going ahead market participants will keenly await industrial output numbers for June followed by retail inflation data on Wednesday, traders said.
“This week, on the domestic front, focus will be on inflation and industrial production number and weaker-than-expected economic data could keep the rupee weighed down. We expect USDINR (Spot) to quote in the range of 74.70 and 75.20,” said Gaurang Somaiyaa, Forex & Bullion Analyst, Motilal Oswal Financial Services.
According to Sriram Iyer, Senior Research Analyst, Reliance Securities, “The Indian Rupee ended with marginal gains this Monday against the US currency supported by dollar inflows and strong local shares. However, a rebound in the US dollar offset the gains stemming from the flows”.
The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 74.9556 and for rupee/euro at 88.7829. The reference rate for rupee/British pound was fixed at 98.3922 and for rupee/100 Japanese yen at 71.01. (AGENCIES)
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