The Indian rupee continued its upward trajectory on Thursday, registering gains for the second straight session against the US dollar. The domestic currency closed 8 paise higher at 82.81 compared to the previous close of 82.89.
Market Performance and Trading Range
During Thursday's trading session, the rupee displayed resilience in the foreign exchange market. The currency opened strong at 82.85 at the interbank foreign exchange and maintained its positive momentum throughout the day. The trading range remained relatively stable, with the local unit moving between an intraday high of 82.80 and a low of 82.87 against the American currency.
Key Factors Driving Rupee's Strength
Several factors contributed to the rupee's positive performance:
- Robust Equity Markets: Positive sentiment in domestic equity markets provided crucial support to the rupee
- Foreign Fund Inflows: Sustained foreign institutional investments continued to bolster the Indian currency
- Dollar Index Movement: The dollar index, which measures the greenback against six major currencies, showed modest gains at 104.11
- Global Crude Oil Prices: Brent crude futures, the global oil benchmark, traded lower at $82.70 per barrel
Broader Market Context
The rupee's appreciation comes amidst mixed global cues and cautious trading sentiment. Forex traders noted that while the local unit benefited from positive domestic factors, the strengthening US dollar in international markets limited the extent of gains. Market participants are closely monitoring the Reserve Bank of India's potential intervention strategies to manage currency volatility.
Expert Analysis and Outlook
Financial analysts suggest that the rupee's performance reflects the underlying strength of the Indian economy amid global uncertainties. The consistent foreign fund inflows into Indian equities indicate continued international confidence in the country's growth prospects. However, traders remain watchful of upcoming economic data releases and central bank policies that could influence future currency movements.
