This Article is From Dec 18, 2020

Rupee Settles Marginally Higher At 73.56 Against Dollar

Rupee Vs Dollar Today: At the interbank foreign exchange market, the domestic unit opened at 73.55 against the greenback and registered an intra-day high of 73.49

Rupee Settles Marginally Higher At 73.56 Against Dollar

Rupee settled at 73.56 against the American currency

A day after settling flat, the rupee rose marginally higher by three paise against the US dollar on Friday, December 18, to close at 73.56 (provisional) amid positive domestic equities and sustained foreign fund inflows. At the interbank foreign exchange market, the domestic unit opened at 73.55 against the greenback and registered an intra-day high of 73.49. It witnessed a low of 73.57. In early trade, the local unit opened five paise higher at 73.54 against the dollar. It finally settled at 73.56 against the American currency, recording a surge of three paise over its previous close. On Thursday, December 17, the domestic unit settled flat at 73.59 against the dollar.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading up 0.20 per cent at 90.00. This week, the rupee witnessed a highly volatile session by registering gains and losses against the greenback. It settled on a flat note yesterday and rose marginally today, amid positive market response. While on Tuesday, it edged lower by eight paise and gained marginally again the following day.

According to traders, the weakness in the American currency in the overseas market supported the domestic unit. According to exchange data, the foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 2,355.25 crore on a net basis on December 17. 

"The dollar crashed on Thursday as hopes of stimulus and Brexit deal improved risk appetite and weighed on the safe haven appeal of the greenback. The dollar index broke below the 90 mark (for the first time) since January 2018," said Reliance Securities in a research note.

"Value erosion in dollar, excessive liquidity is driving foreign investors to bet big on Indian equities, which give the rupee a slight appreciating bias in the near term," said Sugandha Sachdeva VP-Metals, Energy & Currency Research, Religare Broking.

"There is still potential for a spurt in USDINR as covid and Brexit concerns remain along with any breakdown in US fiscal negotiations. The USDINR spot is holding the strong support of 73.50, but with broader vaccine optimism we can expect a fall towards 73.25 zone, while 73.75-74 will continue to act as a strong resistance,'' said Mr. Rahul Gupta, Head of Research- Currency, Emkay Global Financial Services.

On the domestic equity market front, BSE Sensex ended 70.35 points or 0.15 per cent higher at 46,960.69, while the NSE Nifty climbed 19.85 points or 0.14 per cent to 13,760.55.

''The average daily FII flows in the first four days of the week was ~Rs.3200 cr. Going forward expect FII flows to slowdown in the next two weeks as we head towards Christmas vacation. Markets could turn volatile next week due to the monthly expiry and lesser participation from FIIs. We expect Nifty-50 to consolidate between 13,000 & 14,000 levels till the end of this month,'' said Rusmik Oza, Executive Vice President, Head of Fundamental Research at Kotak Securities.

Brent crude futures, the global oil benchmark, fell 0.21 per cent to $ 51.39 per barrel.