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Rupee gains by 7 paise to 73.84 amid weak US dollar, foreign fund inflows

The domestic unit opened at 73.85 per US dollar at the interbank forex market and gained ground to touch 73.84 against the greenback, rising 7 paise over its previous close

twitter-logoBusinessToday.In | November 26, 2020 | Updated 12:53 IST
Rupee gains by 7 paise to 73.84 amid weak US dollar, foreign fund inflows
Meanwhile, the dollar index was down 0.07 per cent to 91.93 against a basket of six currencies

Indian rupee appreciated 7 paise to 73.84 per US dollar on Thursday's opening session amid sustained foreign fund inflows and weak American currency.

The domestic unit opened at 73.85 per US dollar at the interbank forex market and gained ground to touch 73.84 against the greenback, rising 7 paise over its previous close.

On Wednesday, the rupee appreciated by 10 paise to settle at nearly a one-month-high of 73.91 amid a weak dollar and positive development on the coronavirus vaccine front. Meanwhile, the dollar index was down 0.07 per cent to 91.93 against a basket of six currencies.

US markets are shut on Thursday on account of Thanksgiving holiday. Traders said investors reacted to minutes released overnight from the U.S. Federal Reserve's November meeting. The summary of the Fed meeting from earlier this month indicated that U.S. central bank officials discussed ways of getting more money into the economy, which is still recovering from the coronavirus pandemic.

The Bank of Korea on Thursday held steady on its key policy rate at a record low of 0.5%.

Foreign portfolio investors (FPIs) bought shares worth Rs 24.20 crore, while domestic institutional investors (DIIs), were net sellers to the tune of Rs 1,840.33 crore in the Indian equity market on 25 November, provisional data showed.

On the domestic equity market front, market indices opened flat on Thursday and turned marginally negative by the first hour of session on November series expiry day, amid positive global equities. Sensex was trading 50 points lower at 43,775 and Nifty fell by 11 points to 12,846.

Brent crude futures, the global oil benchmark, rose 0.43 per cent to USD 48.82 per barrel. Oil price rose as crude inventories fell and hopes that covid-19 vaccine could revive demand pushing price up for the fifth consecutive day.

"Foreign fund inflows into the domestic equity markets could also help the local unit. However, these flows are being continuously mopped up by the central bank and could cap gains in the currency," Reliance Securities said in a research note.

"The major trigger point for the currency markets could come on Friday as investors awaited economic growth data for the second quarter," the note added.

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