Rupee Rises On Oil Price Dip & FII Inflows: Will The Rally Last?

At the interbank foreign exchange, the rupee opened at 85.75 against the US dollar before rising further to 85.72, up 22 paise against its previous close.

Brent crude, the global oil benchmark, was down 0.37 per cent to USD 69.32 per barrel in futures trade.

Source : Freepik

The rupee rose 22 paise to 85.72 against the US dollar in early trade on the back of fall in global crude oil prices and a weaker greenback.

FII inflows and a positive domestic equity market further boosted the local unit, according to forex traders.

At the interbank foreign exchange, the rupee opened at 85.75 against the US dollar before rising further to 85.72, up 22 paise against its previous close. The local unit logged a steep fall of 54 paise to settle at 85.94 against the US dollar on Monday.

The rupee recovered towards closing yesterday (Monday) after falling due to heavy dollar demand..Oil companies and importers continued to buy dollars while there may have been some dollar sales from the RBI towards the closing, taking rupee up," Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP, said.

The opening of rupee (on Tuesday) is slightly higher after Asian currencies showed some recovery this morning and it could remain in a range of 85.40-86.00,he said.

Brent crude, the global oil benchmark, was down 0.37 per cent to USD 69.32 per barrel in futures trade.

Brent oil prices, which approached USD 70 per barrel, fell to USD 69.28 as investors assessed the impact of Trump's latest tariffs on 12 nations while lingering oversupply concerns from rising OPEC+ output added further pressure,Bhansali said.

The dollar index, which gauges the greenback's strength against a basket of six currencies, was down 0.19 per cent to 97.29.

Meanwhile, at the domestic equity market, the Sensex was trading 85.39 points higher at 83,527.89, while the Nifty was 16.50 points to 25,477.80.

Foreign institutional investors (FIIs) purchased equities worth Rs 321.16 crore on a net basis on Monday, according to exchange data. 

(This report has been published as part of the auto generated syndicate wire feed.Apart from the headline,no editing has been done in the copy by ABP Live)