The Indian rupee touched a six-month high of 94.08 against the US dollar on Friday (November 6), marking its strongest intraday level since May 7, even as it opened weaker against the American currency.
The domestic currency opened at 94.50 against the dollar, depreciating 9 paise from its previous close of 94.41. It initially recovered to 94.36 before strengthening further to touch 94.08, according to the latest market update.
Forex traders said overnight gains in crude oil prices and a recovery in the US dollar had weighed on the rupee.
The dollar index, which measures the greenback’s strength against a basket of six currencies, was trading 0.17% higher at 101.71. Brent crude, the global oil benchmark, was up 2.04% at $100.30 per barrel in futures trade.
Anuj Choudhary, research analyst at Mirae Asset Sharekhan, said the rupee could trade with a positive bias, supported by strength in domestic markets and fresh foreign institutional investor (FII) inflows. However, geopolitical tensions involving Russia and Ukraine, along with developments in the Middle East, could limit gains.
In domestic equity markets, the Sensex rose 33 points to 79,343.06 in early trade, while the Nifty declined 52.95 points to 24,477.40.
Foreign institutional investors were net buyers of Indian equities on Thursday, purchasing shares worth Rs 14,974.68 crore, according to exchange data.
The sustainability of foreign fund inflows, movements in crude oil prices and the strength of the US dollar will remain key factors influencing the rupee’s movement.
-With agencies inputs