Rupee Continues Winning Steak, Closes At 7-Week High Of 73.05 Against Dollar

Continuing its winning streak this week, the rupee gained 17 paise against the US dollar on Tuesday, May 18, to close at a seven-week peak of 73.05, amid positive domestic equities and weaker American currency in the overseas markets. At the interbank foreign exchange market, the domestic unit opened at 73.18 and swung to an intra high of 72.95. It registered an intra day low of 73.18 during the session today. In an early trade session, the local unit gained five paise to 73.17 against the greenback. Today, the domestic currency settled at 73.05 against the dollar, the highest closing level since March 26.

According to forex traders, sharp gains were prevented on a surge in crude oil prices, continued foreign institutional investors or FII outflows. On Monday, May 17, the local unit had closed at 73.22 against the greenback. Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, slipped 0.40 per cent to 89.80.

''As dollar index falls rupee again rises after falling 15 paise yesterday in futures. Inflows continue as stock market rises and positive sentiments rise due to fall in number of covid 19 cases so that economy could open soon. Exporters may sell near to 73.30 while importers may buy cash dollars near to 73.10 as RBI slows down the pace of appreciation,'' said Mr Anil Kumar Bhansali, Head of Treasury - Finrex Treasury Advisors.

''The dollar index opened flat to slightly higher against a basket of Asian currencies, while the Indian Rupee followed suit, beginning the week flat. In today's session, we can see prices react to WPI Inflation data. Due to the weakening of the dollar, the Indian rupee gained ground in the previous session. Price increases were observed, which were aided by exporters' dollar sales,'' said Kshitij Purohit, Lead International Products & Commodities at CapitalVia Global Research Limited.

On the domestic equity market front, the BSE Sensex closed 612.60 points or 1.24 per cent higher at 50,193.33, while the broader NSE Nifty climbed 184.95 points or 1.24 per cent to 15,108.10.

“Markets maintained strong resilience as key indices breached psychological levels, but the day was dominated by mid-cap and small-cap stocks. The Nifty Midcap index closed comfortably in the new territory amid broad-based participation. Along with the Bajaj twins and HDFC twins, we saw combined activity in the Larsen & Toubro triplets. If we consider mainline indices then in that the auto index was the best performer. The Nifty closing above 15100 today is definitely positive for the market,'' said Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities.

According to exchange data, the foreign institutional investors were net sellers in the capital market on May 17, as they offloaded shares worth Rs 2,255.84 crore. Brent crude futures, the global oil benchmark, rose 0.86 per cent to $ 70.06 per barrel.