The Indian rupee appreciated by 9 paise to trade around 83.19 against the US dollar in early trade on Thursday amid weak American currency overseas after the US Federal Reserve was a bit dovish in its policy meeting. The local currency opened 7 paise higher at 83.21 a dollar as compared to previous close of 83.28.
The dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.51% lower at 106.34.
On Wednesday, the rupee settled at an all-time low level of 83.28 against the US dollar.
The US Fed kept interest rates unchanged, while Fed Chair Jerome Powell looked content with the economy’s soft landing. Following the decision, the dollar index softened, and the 10-year bond yield fell to 4.70.
“Asian currencies all gained against the dollar after the dovish FED as risk-on sentiments prevailed in the market. Brent oil rose slightly to USD 85.45 per barrel,” said Anil Kumar Bhansali, Head of Treasury and Executive Director of Finrex Treasury Advisors LLP.
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Bhansali noted that the rupee made a new closing low of 83.29/30 on demand from importers, FPI outflows and ECB redemptions.
“However, today’s opening is higher at 83.22 as FED was a bit dovish in its policy meeting,” he said.
Brent crude futures, the global oil benchmark, rose 0.90% to $85.39 per barrel.
In the domestic equity market, the 30-share BSE Sensex was trading 434.25 points, or 0.68%, higher at 64,025.58. The broader NSE Nifty 50 advanced 132.85 points, or 0.70%, to 19,122.00.
Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Wednesday as they sold shares worth ₹1,816.91 crore, according to exchange data.
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(With inputs from PTI)
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