Rupee Strengthens to 83.84 Against US Dollar in Early Trading
The Indian rupee appreciated by 2 paise to reach 83.84 against the US dollar during early trading on Tuesday, driven by a weaker dollar in the global market and a decline in crude oil prices.
Opening at 83.87 in the interbank foreign exchange market, the rupee quickly gained ground, rising to 83.84 from its previous close of 83.86. However, the currency's rise was somewhat limited due to sluggish domestic equity trends and ongoing foreign fund outflows, influenced by expectations of potential interest rate cuts in the US.
Brent crude oil, the global benchmark, saw a minor increase of 0.45% to USD 73.08 per barrel in futures trading, which added pressure on the rupee's performance.
Amit Pabari, Managing Director of CR Forex Advisors, noted that the combination of falling crude prices and healthy inflows from foreign institutional investors into Indian equities has created a sense of stability in the market. He also indicated that the Reserve Bank of India may intervene around the critical 84-mark to support the rupee if necessary.
Additionally, the dollar index, which measures the greenback's strength against a basket of six currencies, dipped by 0.05% to 100.38. In the domestic equity market, the 30-share BSE Sensex experienced a slight decline of 59.75 points, or 0.07%, settling at 82,929.03, while the Nifty fell by 4.85 points, or 0.02%, to 25,378.90.
On Monday, foreign institutional investors were net sellers in the capital markets, offloading shares worth ₹1,634.98 crore, according to exchange data.
