The rupee made a return from its downturn, gaining 75 paise to close at 88.06 (provisional) against the US dollar on Wednesday, mostly due to intervention by the Reserve Bank of India (RBI), a surge in the domestic markets, a weak US dollar, and an overnight decline in crude oil prices.
Posting its biggest intraday gain in nearly four months, the domestic unit opened at 88.74 against the greenback at the interbank foreign exchange, fell below the 88-mark during the session, and touched a high of 87.93 per dollar.
It finally settled at 88.06 against the greenback, registering a rise of 75 paise over its previous close.
On Tuesday, the rupee depreciated by 13 paise to close at an all-time low of 88.81 against the US dollar.
“We expect the rupee to trade with a positive bias on overall weakness in the US dollar and underlying strength in the domestic markets. Broad weakness in global crude oil prices and fresh foreign inflows may also support the rupee. USD/INR spot price is expected to trade in a range of 87.70 to 88.40,” said Anuj Choudhary, Research Analyst, Currency and Commodities, Mirae Asset ShareKhan.
Also Read: Rupee hits low of 88.80 against US dollar
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.22 per cent lower at 98.82.
Brent crude, the global oil benchmark, was trading 0.19 per cent lower at USD 62.27 per barrel in futures trade.
On the domestic equity market front, Sensex jumped 575.45 points to settle at 82,605.43, while Nifty surged 178.05 points to 25,323.55.
Foreign Institutional Investors sold equities worth ₹1,508.53 crore on Tuesday, according to exchange data.
Forex traders said domestic markets surged nearly 0.70 per cent on optimism over trade talks between India and the US, which reflected in the USD/INR pair.
Despite global headwinds on account of hiked US tariffs on Indian goods, India’s exports grew by 6.74 per cent to USD 36.38 billion in September. Imports jumped 16.6 per cent to USD 68.53 billion.
The country’s trade deficit stood at USD 32.1 billion during the month, according to the commerce ministry data.
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