Rupee Gains To Trade Below 75 Per Dollar, Tracking Declines In Dollar And Oil

The energy-sensitive rupee gained 0.3 per cent to last trade below 75 per dollar early on Tuesday, tracking a broad greenback decline and falling oil prices.

According to Reuters, the rupee was last changing hands at 75.9475 against the dollar, up nearly 0.2 per cent for the day, while PTI reported the currency gained 0.3 per cent in the opening trade at 75.93 against the US dollar on Tuesday. 

A weak dollar in the overseas market also helped the rupee, reported PTI, citing forex traders.

At the interbank foreign exchange, the rupee opened strong at 75.97 against the US dollar and gained further ground to quote at 75.93, a rise of 23 paise over the previous close. The rupee had settled at 76.16 against the greenback in the previous session.

Global oil benchmark Brent crude futures declined over 1.5 per cent to last trade a touch above $110 per barrel, pulled lower by expectations for a fall in demand from China, which is battling a rapid surge in coronavirus cases.

Investors drew support from lower oil prices, and Ukraine and Russia seem to be heading for peace talks.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six major currencies, slipped 0.06 per cent to 98.99.

The domestic bourses' robust run-up this week has also helped the currency.

But what might weigh on the rupee is net capital outflows, with foreign institutional investors (FIIs) being net sellers in the capital market last week.

"On Monday, the rupee rose eight paise to 76.16 against the US dollar, helped by rising domestic equities and lower global crude oil prices. However, the gains in the home currency were limited due to a strengthening of the US dollar abroad and concerns about fresh international capital outflows. For the past six trading sessions, the rupee has fluctuated between 76 and 76.50," said Kshitij Purohit, Lead International and Commodities at CapitalVia Global Research.