Rupee Rebounds 11 Paise on Falling Oil, Weaker Dollar
Overview
The Indian rupee recovered 11 paise in early trade Wednesday, settling at 90.12 against the US dollar. Gains were driven by easing crude oil prices and a softer US currency globally. However, traders remain cautious ahead of key US inflation data and geopolitical developments.
The Indian rupee staged a recovery in early Wednesday trade, gaining 11 paise against the US dollar to reach 90.12. The domestic currency had opened weaker at 90.26 but rebounded to an intraday high of 89.94 before settling. This marks an improvement from Tuesday's close of 90.23.
Key Drivers of Recovery
Forex analysts attributed the rebound to declining crude oil prices and a marginal retreat in the US dollar in overseas markets. Brent crude, the global benchmark, slipped 0.47 per cent to USD 65.17 per barrel. The dollar index, measuring its strength against major currencies, was trading down 0.01 per cent at 98.90.
Cautious Outlook Persists
Despite the intraday recovery, market participants maintained a cautious stance. Geopolitical developments and anticipation of crucial US inflation data, which could influence the Federal Reserve's next monetary policy decision, kept sentiment guarded.
Domestic Market Snapshot
Indian equity benchmarks displayed resilience. The Sensex added 34.81 points to 83,662.50, while the Nifty gained 14.15 points to 25,746.90. However, foreign institutional investors continued to divest, offloading Indian equities worth Rs 1,499.81 crore on Tuesday.
