Rupee appreciated by 40 paise against the dollar, today

Mumbai, Aug 19 -The rupee appreciated by 40 paise to close provisionally at 86.99 against the US dollar on Tuesday, buoyed by optimism surrounding proposed GST restructuring measures and support from firm domestic equity markets. Market sentiment was further aided by a softer dollar index and lower crude oil prices, which helped ease India’s import bill.

Strong Session for Rupee

In the interbank foreign exchange market, the rupee opened at 87.24, moved to an intraday low of 87.31, rose to a high of 86.92, and finally closed at 86.99. This is its best in a month, following Monday’s 20 paise increase that had pushed it to 87.39.

Market participants credited the shift to relax global tariff tensions following a meeting between US President Donald Trump and Russian President Vladimir Putin, in addition to firm domestic policy cues.

GST Rationalisation Boosts Sentiment

Investor confidence was lifted after Prime Minister Narendra Modi’s Independence Day announcement on restructuring GST slabs. The current four-tier system of 0, 5, 12, 18, and 28 per cent is proposed to be replaced by two primary slabs of 5 per cent and 18 per cent, with a special 40 per cent top bracket for demerit goods.

External and Domestic Factors in Play

Brent crude futures eased around 1.04% to about US$65.91 per barrel, relieving some pressure on India’s import bill. The dollar index also dipped slightly-by 0.13% to around 98.04-providing modest support to the rupee.

Domestically, the BSE Sensex climbed 370.64 points to finish at 81,644.39, while the NSE Nifty advanced 103.70 points to close at 24,980.65. Foreign Institutional Investors remained net buyers, injecting approximately ₹550.85 crore into Indian equities on Monday.

Adding to the bullish momentum, GIFT Nifty futures were trading about 0.12% higher, pointing toward another positive open.

Outlook

Analysts look for the rupee to trade with a bullish tendency in the near future, aided by positive domestic sentiment, softer crude oil prices, and widespread weakness in the greenback. But rising demand from importers for dollars may cap sharp appreciation.

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