Rupee Rises 31 Paise to 94.86 Against the US Dollar in Early Trade

Supported by the continuing impact of the Reserve Bank of India’s structural forex interventions and liquidity tightening measures, the rupee rose 31 paisa versus the US dollar in early trade on Thursday to 94.86. The rupee’s sustained appreciation, according to market players, was caused by central bank intervention and the unwinding of long dollar holdings.

They did say, though, that more improvements would probably be slowed by persistent external macroeconomic issues. Meanwhile, the RBI’s recent forex actions, such as the special dollar window for oil corporations, are alleviating the immediate strain on the spot market.

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The dollar index, which measures the greenback’s strength against a basket of six currencies, was trading 0.54 percent lower at 101.99. In futures trading, Brent crude, the international benchmark for oil, was down 1.66 percent at 104.30 USD per barrel.

In early trading on the domestic equities market, the Sensex increased by 354 points to reach 73,157.43, and the Nifty increased by 96.15 points to reach 22,726.05. According to exchange statistics, foreign institutional investors (FIIs) sold Rs 1,857.44 crore worth of shares on a net basis on Wednesday.

(Disclaimer: Given the input is on an information basis, please seek professional advice.)