Rupee settles 5 paise higher at 73.58 against US dollar

Mumbai, Dec. 16 (PTI): The rupee appreciated 5 paise to close at 73.58 (provisional) against the US dollar on Wednesday, as sustained foreign fund inflows and strong domestic equities strengthened investor sentiment.

Traders said the weakness of the American currency in the overseas market also supported the domestic unit.

At the interbank forex market, the rupee opened at 73.49 against the US dollar and witnessed an intra-day high of 73.48 and a low of 73.60.

The local unit finally closed at 73.58 against the American currency, registering a gain of 5 paise over its previous close.

On Tuesday, the rupee had depreciated by 8 paise to 73.63 against the US dollar.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.35 per cent lower at 90.15.

“The currency market is very lacklustre and the focus is on tonight’s Fed policy. The hopes of a dovish Fed have kept dollar bulls on sidelines.

“In our view, the global optimism over rolling out of coronavirus vaccine and the hopes of another US fiscal stimulus package may push USD/INR spot towards 73.25. Also, RBI is not very aggressive with its intervention. So, consistent trading below 73.25 will push the price towards 73 zone, while 74 will act as a strong resistance,” said Rahul Gupta, Head of Research- Currency, Emkay Global Financial Services.

On the domestic equity market front, BSE Sensex ended 403.29 points or 0.87 per cent higher at 46,666.46, while NSE Nifty rose 114.85 points or 0.85 per cent to 13,682.70.

Foreign institutional investors were net buyers in the capital market as they purchased shares worth INR 2,484.09 crore on a net basis on Tuesday, according to exchange data.

Brent crude futures, the global oil benchmark, rose 0.26 per cent to USD 50.89 per barrel.