Daijiworld Media Network - Mumbai
Mumbai, Dec 30: The Indian rupee gained 3 paise to 89.95 against the US dollar in early trade on Tuesday, supported by a weaker greenback and strong industrial output data, even as foreign fund outflows, higher crude prices, and a weak start in domestic equities capped sharper gains.
The local currency opened at 89.98 at the interbank forex and strengthened to 89.95, reversing some of Monday’s 8 paise loss when it had settled at 89.98.
Anil Kumar Bhansali, Head of Treasury at Finrex Treasury Advisors LLP, noted that the Index of Industrial Production (IIP) for November surged to a 25-month high of 6.7%, surpassing expectations of 2.5%. Growth for the fiscal year so far stands at 3.3%, up from 2.7% in the previous month, lending support to the rupee.
Domestic equities opened in the red amid weak global cues. At 9:19 AM, Nifty50 was trading at 25,902.85, down 39 points (0.15%), while BSE Sensex slipped 128 points (0.15%) to 84,567.40.
Foreign institutional investors (FIIs) sold equities worth Rs 2,759.89 crore on Monday. Meanwhile, the dollar index dipped slightly by 0.03% to 98.01, reflecting a mildly softer greenback.
Experts noted that the RBI’s intervention to protect the top end of the currency curve, combined with FPI dollar purchases, helped maintain bids around the 90-rupee level.
The rupee’s movement remains sensitive to global cues, crude oil prices, and equity flows in the near term.