The rupee gained 19 paise to close at 74.68 (provisional) against the US dollar on Tuesday, as IPO-related inflows supported the local unit amid a lackluster trend in the domestic equity market.
At the interbank forex market, the domestic unit opened at 74.83 against the greenback and witnessed an intra-day high of 74.66 and a low of 74.86 during the day’s trade. It finally ended at 74.68 a dollar. On Monday, the rupee had settled at 74.87 against the US dollar. The dollar index, which gauges the greenback’s strength against a basket of six currencies, advanced 0.06 percent to 93.94.
“After two days of lackluster movements, the rupee has appreciated quarter percentage points backed by inflows from IPOs. While overseas markets traded sideways ahead of the US Fed and Bank of England policy meeting this week,” said Dilip Parmar, Research Analyst, HDFC Securities. Dollar supply remained high on the back of IPOs, while traders may remain light in holiday truncated weeks, Parmar said, adding “Spot USD/INR is expected to trade in a tight range of 74.50 to 75”.
On the domestic equity market front, the BSE Sensex fell 109.40 points or 1.18 percent to end at 60,029.06, while the broader NSE Nifty declined 40.70 points or 0.23 percent to 17,888.95. Brent crude futures, the global oil benchmark, rose 0.27 percent to USD 84.94 per barrel. Foreign institutional investors were net sellers in the capital market on Monday as they offloaded shares worth Rs 202.13 crore, as per exchange data.