Rupee rises 11 paise to 82.20 against U.S. dollar in early trade

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| Photo Credit: The Hindu

The Rupee gained 11 paise to 82.20 against the U.S. dollar in early trade on May 16 supported by sustained foreign fund inflows.

Forex traders said a weak trend in domestic equities and strength of the American currency in the overseas market weighed on investor sentiments.

At the interbank foreign exchange, the domestic unit opened at 82.22 against the dollar and then rose to 82.20, registering a gain of 11 paise over its previous close. On Monday, the Rupee closed at 82.31 against the U.S. currency.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.06% to 102.37. Brent crude futures, the global oil benchmark, declined 0.51% to $75.61 per barrel.

“Going further, rising oil prices could remain a concern for the local unit as the U.S. begins refilling its strategic reserve and has confirmed purchasing up to three million barrels of oil for the SPR,” CR Forex Advisors MD-Amit Pabari said.

“Rising U.S. dollar and oil, and weakening EM peer currencies make clear room for the USD-INR pair to move above 82.50 – 82.80 levels in the next 15-20 sessions,” Mr. Pabari added.

Foreign Institutional Investors (FIIs) were net buyers in the capital market on Monday as they purchased shares worth ₹1,685.29 crore, according to exchange data.

In the domestic equity market, the 30-share BSE Sensex declined 19.76 points or 0.03% to 62,325.95. The broader NSE Nifty fell 1.55 points or 0.01% to 18,397.30.

Meanwhile, India’s exports contracted by 12.7%, for the third month in a row, to $34.66 billion in April even as the trade deficit reduced to a 20-month low of $15.24 billion, the government data showed on May 15.