Mumbai: The rupee rose by 16 paise to close at 73.35 (provisional) against the US dollar on Monday, marking its third straight session of gains on the back of positive domestic equities and weak American currency.
At the interbank forex market, the rupee opened at 73.34 and hit an intra-day high of 73.33 and a low of 73.48.
The local unit finally settled at 73.35, registering a gain of 16 paise over its previous close. On Friday, the rupee had settled at 73.51 against the American currency.
The rupee has strengthened by 56 paise in the three sessions to Monday.
“The Indian rupee appreciated amid weakness in dollar and rise in risk appetite in the global markets. Markets sentiments improved on speculation that US Federal Reserve will maintain its ultra low interest rates for quite some time,” said Saif Mukadam, Research Analyst, Sharekhan by BNP Paribas.
However, sharp gains were prevented on surge in crude oil prices and FII outflows.
Foreign institutional investors were net sellers in the capital market on Friday as they offloaded shares worth Rs 1,142.75 crore, as per exchange data.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.09 per cent to 90.15.
On the domestic equity market front, the BSE Sensex ended 295.94 points or 0.60 per cent higher at 49,502.41, while the broader NSE Nifty advanced 119.20 points or 0.8 per cent to 14,942.35.
Rupee may slip on concern that rising COVID-19 cases in India and lockdown restriction in some states may hurt economic recovery. Traders fear that worsening situation in India may put pressure on central government to announce nationwide lockdown for few days to curb outbreak, Mukadam said.
After recording over four lakh fresh cases for four consecutive days, India witnessed a single-day rise of 3,66,161 COVID-19 cases on Monday, which pushed its tally to 2,26,62,575, according to the health ministry.
Brent crude futures, the global oil benchmark, rose 0.51 per cent to USD 68.63 per barrel. (agencies)
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