Rupee Rises 7 Paise To 95.19 Against US Dollar, Weak Greenback Supports Gains Amid Crude Oil Concerns

Mumbai: The Indian rupee strengthened by 7 paise to 95.19 against the US dollar in early trade on Friday, supported by a weaker American currency and declining US Treasury yields. However, elevated crude oil prices and weak Asian markets limited further appreciation.

The domestic currency opened at 95.21 at the interbank foreign exchange market before strengthening to 95.19 against the greenback. On Thursday, the rupee had settled 2 paise higher at 95.26.

Dollar Weakness

The US dollar index, which measures the greenback against six major currencies, declined 0.27% to 101.75. Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan, said softer US Treasury yields supported the rupee, although rising oil prices and weak Asian equities restricted gains. The European Central Bank and Bank of Japan also maintained their existing interest rates.

Crude Pressure

Brent crude futures were trading 1.05% lower at $116.09 per barrel. Despite the decline, elevated global oil prices remained a concern for India's import-dependent economy. Forex traders said sustained capital inflows and reduced oil import costs could strengthen the rupee. They expect the USD-INR pair to trade within the immediate range of 94.75–95.75.

RBI Intervention

Anindya Banerjee, Head of Commodity and Currency Research at Kotak NEO, said the Reserve Bank of India's presence would remain important in maintaining orderly currency movements. He identified developments in West Asia, the November 3 US midterm elections and upcoming American inflation and employment figures as major triggers.

Market Movement

Domestic equity benchmarks traded higher in early deals. The Sensex gained 138.77 points to 74,289.81, while the Nifty advanced 38.95 points to 22,967.10. Foreign institutional investors sold equities worth ₹943.60 crore on Thursday.

Meanwhile, the International Monetary Fund (IMF) recommended greater exchange rate flexibility to help India absorb energy-related economic shocks. IMF Communications Director Julie Kozack said allowing the rupee to reflect external pressures would support economic adjustment.