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Rupee Rises To Close At 75.66 As Dollar Weakens

The rupee is down6.03% against the dollar so far this year
The rupee is down6.03% against the dollar so far this year

The rupee gained by 29 paise - or 0.38 per cent - to close at 75.66 against the dollar on Tuesday, as trading in the currency markets resumed after a day's holiday. The rupee tracked gains in Asian currencies which strengthened against the US dollar amid growing optimism on a global economic recovery from the COVID-19 pandemic and US-China tensions, say analysts. The rupee strengthened by 33 paise - or 0.43 per cent - against the greenback to touch 75.62 at the highest level recorded during the four-hour session, having started the day at 75.69.

Losses in the domestic equity markets however capped the gains.

Domestic equity benchmarks erased all the day's gains to end slightly lower on Tuesday, led by a fall in Bharti Airtel and IT shares amid concerns over a sharp rise in coronavirus cases.

The S&P BSE Sensex index declined 0.21 per cent to end at 30,609.30, and the broader NSE Nifty 50 benchmark fell 0.1 per cent to 9,029.05, after rising more than 1 per cent during the day.

The financial markets remained closed on Monday for Id-Ul-Fitr.

Crude oil prices rose on Tuesday supported by growing confidence that producers are following through on commitments to cut supplies and as fuel demand picks up as coronavirus lockdowns ease.

Brent crude futures - the global benchmark for crude oil - were last up 1.5 per cent at $36.06 per barrel.

The dollar index - which measures the greenback's strength against six currencies - fell as much as 0.71 per cent on Tuesday, and was last seen trading down 0.62 per cent.

"The rupee is likely to trade in the range of 75.50-75.95 in the near term. Asian currencies are stronger against the dollar. Overall risk sentiment is positive," said Abhishek Goenka, founder and CEO of forex advisory firm IFA Global.

At the current level, the rupee is down 6.03 per cent against the greenback so far this year.

Currency markets currently operate within reduced trading hours due to the coronavirus-induced lockdown. The temporary timings are from 10 am to 2 pm, instead of the normal timings of 9 am to 5 pm.