Rupee Gains 23 Paise to 85.49 Against Dollar Amid FII Inflows and Market Optimism

Mumbai, June 27 – The Indian rupee appreciated by 23 paise to 85.49 against the US dollar in early trade on Friday, bolstered by strong foreign institutional investor (FII) inflows and upbeat sentiment in the domestic equity markets.

Key Drivers Behind the Rupee’s Rise

According to forex traders, a combination of factors supported the rupee’s upward movement. FIIs made net equity purchases worth ₹12,594.38 crore on Thursday, adding strength to the local currency. At the interbank foreign exchange, the rupee opened at 85.50 and strengthened further to 85.49, marking a gain of 19 paise from its previous close.

The rupee had closed at 85.72 against the dollar on Thursday, registering a 36-paise gain for that session as well.

Trading Range Outlook

Anil Kumar Bhansali, Head of Treasury and Executive Director at Finrex Treasury Advisors LLP, commented that the rupee is likely to remain in the 85.35 to 85.95 range. He added that while inflows have dominated recently, outflows linked to oil imports, RBI dollar purchases, and foreign portfolio investors buying dollars could moderate gains.

Global Factors in Play

Despite the rupee’s gains, rising global crude oil prices and a firm dollar index are exerting some pressure. The dollar index, which measures the US dollar’s performance against six major currencies, edged up 0.10 percent to 97.24.

Brent crude futures rose 0.47 percent to USD 68.05 per barrel after a previous decline. The uptick in oil prices was attributed to resilient US demand, though weekly losses remained likely amid reduced geopolitical tensions following a ceasefire between Iran and Israel.

Domestic Markets Continue Uptrend

The domestic equity markets also contributed to the rupee’s momentum. The BSE Sensex climbed 229.22 points to 83,985.09 in early trade, while the NSE Nifty advanced 73.5 points to 25,622.50.

Overall, strong FII inflows and positive equity cues provided a solid foundation for the rupee’s rise, although external factors like crude oil and dollar strength may continue to influence short-term trends.

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