Mumbai: The Indian rupee rebounded by 33 paise to close at 73.14 against the US dollar on Friday, shrugging off tepid sentiment emanating from sell-offs in domestic equities and weak macroeconomic indicators. On weekly basis too, the domestic currency gained 25 paise vis–vis US dollar.
At the interbank forex market, the rupee opened on a strong note at 73.38 and gained further ground to close at 73.14, registering a gain of 33 paise a dollar over its previous close. During the trading session, the local unit touched an intra-day high of 73.01 and a low of 73.47 against the greenback.
“The currency gained despite weakness in domestic equities as uncertainty between India and China remained high,” said Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services. “Better-than-expected economic data could extend gains for the greenback. We expect USD/INR (Spot) to quote in the range of 73.00 and 73.50,” Somaiya said.
All macro indicators including GDP print as well as numbers of manufacturing and service sectors have been suggesting a long road to economic recovery, especially in the wake of the COVID-19 pandemic. Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.06 per cent higher at 92.79.
Brent crude futures, the global oil benchmark, rose 0.41 per cent to USD 44.25 per barrel. On the domestic equity market front, the BSE Sensex ended 633.76 points or 1.63 per cent lower at 38,357.18. The NSE Nifty plunged 193.60 points or 1.68 per cent to close at 11,333.85.
“Indian rupee marked fourth weekly gains in row on stronger Asian peers and foreign fund inflows. Market is expecting better fund inflow for IPOs throughout this month which will provide support to rupee,” said Devarsh Vakil, Deputy Head Retail Research, HDFC Securities. “Market participants will focus on today’s US labour market report. A below-consensus NFP and unchanged unemployment rate may modestly weigh on risk and further help the dollar,” he added.
Foreign institutional investors were net sellers in the capital market on Friday as they offloaded shares worth Rs 1,888.78 crore, exchange data showed.
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