Rupee trades in narrow range against US dollar
The rupee traded in a narrow range against the US dollar in early trade on Friday, as the support from positive domestic equities was negated by elevated crude oil prices and strong American currency.
The dollar strengthened after the release of the US inflation number that was reported higher-than-expectation. The rupee opened at 83.02 against the dollar and touched a low of 83.07 in initial trade.
However, a bullish trend in domestic equities, wherein both benchmark indices touching all-time high levels, supported the rupee at lower levels. The BSE Sensex advanced 102.84 points or 0.15% to 67,621.84, while the NSE Nifty was up 30.25 points or 0.15% to 20,133.35.
Forex traders said the rupee is likely to trade with a slight negative bias on expectations that the US dollar may rise further. However, any intervention by the Reserve Bank of India and positive domestic markets may support the rupee at lower levels.
The dollar index, which measures the strength of the US dollar against a basket of six currencies, fell by 0.15% to 105.28. Brent crude futures, the global oil benchmark, was trading 0.95% higher at USD 94.59 per barrel.
Gaurang Somaiya, forex and bullion analyst at Motilal Oswal Financial Services, said the focus will be on consumer sentiment and Empire State manufacturing index number from the US.
“We expect the USDINR (Spot) to trade sideways and quote in the range of 82.80 and 83.20,” Somaiya said.
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