The rupee appreciated 13 paise to 87.80 against the US dollar in early trade on Thursday. This rise was supported by optimism surrounding the US-India trade deal. Foreign fund inflows and a positive trend in domestic equities also boosted investor sentiments.
Forex traders noted that risk-on sentiments played a key role in the currency’s performance. The interbank foreign exchange market saw the rupee open stronger at this level. It marked a gain from its previous close, reflecting renewed confidence.
On Monday, the rupee had settled 9 paise higher at 87.93 against the greenback. Markets were closed on Tuesday and Wednesday for Diwali holidays. This break allowed traders to reassess positions amid global developments.
Anil Kumar Bhansali of Finrex Treasury Advisors highlighted the trade deal optimism. He mentioned expectations of reduced tariffs on Indian goods from 50% to 16%. This potential agreement fueled the rupee’s upward movement against the dollar.
Prime Minister Narendra Modi and US President Donald Trump discussed trade issues in a phone call. Their conversation aimed to repair bilateral ties strained by tariffs. Trump described the India-US relationship as great and hinted at upcoming deals.
Market sentiment remains cautious as traders monitor global cues. US economic data and RBI monetary signals will provide further direction. These factors could influence the rupee’s trajectory in coming sessions.
Trump reiterated that India agreed to reduce oil purchases from Russia. He stated this would bring them down to almost nothing by year-end. However, he acknowledged it is a process that will take time.
The dollar index traded 0.15% higher at 99.04. This measure gauges the greenback’s strength against a basket of currencies. Its movement impacts emerging market currencies like the rupee.
Brent crude futures rose 2.64% to USD 64.24 per barrel. As a global oil benchmark, its price affects India’s import costs and currency stability. Higher crude prices often pressure the rupee.
Domestic equity markets showed strong gains. The Sensex jumped 734.36 points to 85,160.70 in early trade. The Nifty surged 198.3 points to 26,066.90, supporting the rupee’s rise.
Foreign Institutional Investors purchased equities worth Rs 96.72 crore on Tuesday. These inflows contributed to positive market sentiment. They reflect confidence in India’s economic prospects.
The rupee’s performance against the dollar remains in focus. Trade deal progress and global factors will shape its path. Investors are watching for concrete developments to sustain gains.
Early trade dynamics set a positive tone for the day. The rupee’s appreciation against the dollar highlights underlying strengths. Continued monitoring of international events is essential.
Overall, the currency market responded to multiple supportive factors. The interplay between domestic and global influences will determine future moves. Traders remain alert to any shifts in sentiment.