Rupee does U-turn, rises 23 paise to 69.35 against U.S. dollar

After opening on a weak note, the rupee recovered the lost ground and finally settled 23 paise higher at 69.35 to the U.S. dollar amid weakening of the greenback against major currencies.

At the interbank foreign exchange (forex), the domestic currency witnessed heavy volatility. The local unit opened at 69.58 a dollar and touched a low of 69.60 and high of 69.34 during the day. The local unit finally closed at 69.35 against the American currency, registering a rise of 23 paise over its previous close. On Friday, the rupee had settled at 69.58 against the U.S. dollar.

“Sustained weakness in the Dollar Index could be the prime reason for strength in the domestic currency,” said V.K. Sharma, Head PCG & Capital Markets Strategy, HDFC Securities. The dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.22% to 96.00.

Forex traders said the uptick in the rupee assumes significance amid brent above $65 per barrel, foreign fund outflows and resignation of RBI Deputy Governor Viral Acharya. Brent crude futures, the global oil benchmark, fell 0.14% to trade at $65.11 per barrel.

“Globally, the OPEC meet on Tuesday and the US-Saudi-Iran triumvirate will dictate crude oil dynamics which in turn will dictate INR fluctuations,” WGC Wealth Chief Investment Officer Rajesh Cheruvu said.

Foreign investors bought shares worth ₹207.33 crore on a net basis on Monday, provisional data showed. Meanwhile, the 10-year government bond yield was at 6.85% on Monday.

Meawhile, the BSE benchmark index settled 71.53 points, or 0.18%, lower at 39,122.96. The broader NSE Nifty dropped 24.45 points, or 0.21%, to 11,699.65.

Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 69.6343 and for rupee/euro at 78.5851. The reference rate for rupee/British pound was fixed at 88.3650 and for rupee/100 Japanese yen at 64.90.

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