Forex traders said the rupee opened positive this morning with Brent crude retreating from elevated levels on easing immediate supply concerns, as Saudi Arabia increased exports through the Strait of Hormuz and markets were hopeful of partial restoration of the damaged East-West pipeline.
At the interbank foreign exchange market, the rupee opened at 95.75, then touched 95.65 against the American currency, registering a gain of 13 paise from its previous close.
On Monday, the rupee appreciated 18 paise to close at 95.78 against the US dollar.
“The rupee remains range-bound. Softer crude is its main support, offset by a firm dollar after the Fed’s hike and continued foreign portfolio outflows,” said Anindya Banerjee, Head of Commodity and Currency Research, Kotak Securities.
Banerjee further said: “We see 96.30 as the upper cap, with strong Reserve Bank intervention expected as the pair approaches 96.30-96.50, and support at 95.50 and then 95.”
“The central bank has also been actively draining the surplus liquidity created by the special deposit inflows through bond sales and reverse-repo auctions, which is keeping the adjustment orderly,” he added.Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading at 100.35, down marginally by 0.07 per cent.
Brent crude, the global oil benchmark, was trading higher by 1.05 per cent at USD 101.39 per barrel in futures trade.
On the domestic equity market front, Sensex rose 42.51 points to 74,901.50 in opening trade, while the Nifty was up 39.75 points to 23,454.05.
Foreign Institutional Investors (FIIs) offloaded equities worth Rs 576.20 crore on a net basis on Monday, according to exchange data.
Government data released on Monday showed the output of the country’s nine key infrastructure sectors slowed down to a three-month low of 4.8 per cent in August due to a fall in the production of coal, natural gas, crude oil, and fertiliser. The output expanded by 6.2 per cent in the same month last year and by 5 per cent in July this year.
