Rupee Rises 19ps To 87/$

Mumbai: The rupee appreciated by 19paise to close at 87.00 against the US dollar on Wednesday on sharp pullback in domestic equities, a weak American currency and a decline in crude oil prices. Forex traders said US President Donald Trump’s tariff escalation has set off a chain reaction in global markets, sending the dollar into a downward spiral. At the interbank foreign exchange, the rupee witnessed high volatility. It opened at 87.18 then touched the intraday high of 86.93 and the low of 87.20 against the greenback.

The unit ended the session at 87.00 against the dollar, registering a gain of 19paise from its previous closing level. Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.79 per cent lower at 104.91 amid trade tariff uncertainties. “We expect the rupee to trade with a slight positive bias on weakness in the US dollar and a decline in crude oil prices. Any extended recovery in the domestic markets may also support the rupee,” said Anuj Choudhary – Research Analyst at Mirae Asset Sharekhan.

However, FII outflows may cap sharp gains. Uncertainty over the trade tariff issue may further pressurise the rupee. “Traders may take cues from ISM services PMI and ADP non-farm employment data from the US. USD-INR spot price is expected to trade in a range of Rs 86.75 to Rs 87.20,” Choudhary added.