Daijiworld Media Network - New Delhi

New Delhi, May 2: The Indian rupee continued its upward momentum against the US dollar on Friday, appreciating by 40 paise and breaching the significant 84-mark for the first time in seven months, buoyed by robust foreign fund inflows and positive developments in Indo-US trade negotiations.

The local currency opened the session at 84.09 and climbed to 83.90 during early trade. In comparison, the rupee had closed at 84.49 per dollar in the previous session. Friday’s movement marks the first instance since October 1, 2024 that the rupee has traded below the 84-level, when it had touched 83.82.

Currency market analysts attributed the rupee’s strength to a resurgence in foreign institutional investments (FIIs) in Indian debt and equity markets, coupled with growing optimism over a potential trade agreement between India and the United States.

“Despite the dollar index remaining firm, the rupee strengthened on expectations that India could emerge as a key alternative to China in US trade flows, boosting confidence in Indian markets,” experts noted.

In recent weeks, foreign investors have returned strongly to Indian markets following a period of global volatility. Over the past 11 trading sessions alone, FIIs have infused Rs 37,375 crore into Indian equities and bonds, signalling renewed confidence in the country’s economic outlook.

Also supporting the rupee is a noticeable decline in the US dollar index, which has dipped below the 100-mark and is currently hovering around 99. The index, which tracks the performance of the greenback against six major global currencies, has shown signs of weakness amid evolving global trade dynamics.

Meanwhile, in a recent interview with American media, US trade negotiator Jamieson Greer said that the two countries were close to finalising a long-anticipated trade agreement. Although not yet concluded, talks were progressing steadily, he added.

“I have a standing call with India’s commerce and industry minister (Piyush Goyal). I sent my team to India for a week. They were here last week and I met with their chief negotiator,” Greer stated.

Commenting on US vice-president J D Vance’s visit to India, Greer referred to a recently announced framework for trade negotiations between the two nations, hinting at growing alignment on strategic economic matters.