Rupee trades in narrow range against US dollar in early trade

Mumbai, May 10 (PTI) The rupee was trading in a narrow range against the US dollar in early trade on Friday, as the support from positive domestic equities was negated by elevated crude oil prices.

Forex traders said the strength of the American currency in the overseas market and significant foreign fund outflows dented investors’ sentiments. At the interbank foreign exchange market, the local unit opened at 83.48, it touched 83.46 in the initial trade, registering a gain of 2 paise from its previous close.

On Thursday, the rupee closed at 83.48 against the American currency. “The Indian Rupee was again sold-off on Thursday as FPIs outflows continued to trigger demand for the US dollar, while probable RBI selling at 83.50 did not allow a higher up move on the USD/INR pair. On Friday also the same is expected from the USD/INR pair with RBI continuing its control at 83.50,” said Anil Kumar Bhansali, Head of Treasury and Executive Director Finrex Treasury Advisors LLP.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was at 105.30, higher by 0.07 per cent.

Brent crude futures, the global oil benchmark, rose 0.55 per cent to USD 84.34 per barrel.

On the domestic equity market, the 30-share BSE Sensex was trading 169.82 points, or 0.23 per cent higher at 72,573.99 points. The broader NSE Nifty was up 67.05 points, or 0.31 per cent, to 22,024.55 points.

Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Thursday as they offloaded shares worth Rs 6,994.86 crore, according to exchange data.

“FPIs offloaded Rs 22,858 crore in six market sessions in May 2024, while DIIs (Domestic Institutional Investors) were buyers to the tune of Rs 16,700 crore. Uncertainty in election results and higher US treasury yields were the main causes of this sell-off,” Bhansali added.