Mumbai : The rupee rose by 3 paise to settle at 72.94 (provisional) against the US dollar on Monday, extending its gains for the fifth straight session despite heavy selling in the domestic equity market.
At the interbank forex market, the rupee opened at 72.95 against the American currency, and hit an intra-day high of 72.89 and a low of 72.96 in day trade.
It finally finished at 72.94, higher by 3 paise over its last close. On Friday, the rupee had settled at 72.97 against the American currency.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, advanced 0.10 per cent to 90.32.
“The rupee has managed to hold its fort around the 72.90 to 73 levels, but given the selloff in equities and the likelihood of a rebound in the dollar index, we see the trend tilting slightly towards depreciation going forward,” said Sugandha Sachdeva VP-Metals, Energy & Currency Research, Religare Broking.
In terms of the global cues, the Federal Reserve’s policy decision this week is not expected to be ultra-dovish. More so, markets will be watching the Fed’s guidance on rates and any outlook on its bond buying plan, Sachdeva added.
Another key factor to watch out for the rupee is the Union Budget.
“If the government compromises on the fiscal guidance by a huge margin in an attempt to revive the economy, rupee may take a hit and further depreciation looks likely on the cards. We expect the Indian rupee to hover in the range of 72.50-73.50 in near term,” Sachdeva said.
On the domestic equity market front, the BSE Sensex ended 530.95 points or 1.09 per cent lower at 48,347.59, while the broader NSE Nifty declined 133 points or 0.93 per cent to 14,238.90.
Foreign institutional investors were net sellers in the capital market as they offloaded shares worth Rs 635.69 crore on a net basis on Friday, according to exchange data.
Brent crude futures, the global oil benchmark, rose 0.65 per cent to USD 55.77 per barrel. (AGENCIES)
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