Mumbai, May 24 (PTI) The rupee rallied for the fourth consecutive trading session and settled with a sharp gain of 19 paise at 83.10 against the US dollar on Friday amid a weak American currency and suspected intervention by the RBI.
Forex traders attributed the rally to Rs 2.11 lakh crore record dividend by the RBI to the government for the fiscal ended March 2024. It was more than double the budgeted expectation, helping shore up revenue ahead of a new government taking office.
At the interbank foreign exchange, the domestic unit opened at 83.26 and moved in the range of 83.03 and 83.26 against the greenback during the session.
The local unit finally settled at 83.10 against the dollar, registering a gain of 19 paise from its previous close. In the last four trading sessions the local unit has added 40 paise against the American currency.
The forex market was closed on Thursday on account of ‘Buddha Purnima’.
On Wednesday, the rupee appreciated by 2 paise to settle at 83.29 against the US dollar.
“The Indian rupee gained on suspected intervention by the Reserve Bank of India (RBI). The RBI’s Rs 2.11 lakh crore dividend to the government also boosted market sentiments,” said Anuj Choudhary – Research Analyst at Sharekhan by BNP Paribas.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, declined 0.34 per cent to 104.67.
Brent crude futures, the global oil benchmark, climbed 0.59 per cent to USD 81.84 per barrel.
Traders are expected to take cues from durable goods orders and revised consumer sentiment data from the US. “USD-INR spot price is expected to trade in a range of Rs 82.80 to Rs 83.30,” Choudhary said.
Dilip Parmar, Research Analyst, HDFC Securities, said better macro environment backed by foreign fund inflows led to an appreciation in the local rupee.
“In the near term, spot USD-INR is expected to head towards 82.86 once the 83 breaks while the previous support 83.30 becomes resistance,” he added.
According to Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP, “The rupee is expected to gain as we come closer to month end and then the election results. The range for Monday is expected to be 82.85 to 83.25.” On the domestic equity market front, benchmark equity indices scaled new peaks in intra-day trade before ending flat.
The 30-share Sensex declined 7.65 points, or 0.01 per cent, to settle at 75,410.39 points, and Nifty fell 10.55 points, or 0.05 per cent, to close at 22,957.10 points.
Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Friday, as they offloaded shares worth Rs 944.83 crore, according to exchange data. PTI DRR HVA
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