Rupee recovers from all-time low to settle 6 paise higher at 84.40 against US dollar

The rupee recovered from its all-time low level and settled with a gain of 6 paise at 84.40 (provisional) against the US dollar on Monday, backed by a retreating American currency.

Forex traders said, the recovery in the local unit was capped by the unabated withdrawal of foreign funds amid lacklustre sentiment in the domestic equity markets as well as an upward movement in crude oil prices.

At the interbank foreign exchange, the rupee opened at 84.42 and touched the intra-day high of 84.37 against the greenback during the session. It finally settled at 84.40 (provisional) against the dollar, up 6 paise from its previous close.

On Thursday, the rupee fell 7 paise to settle at its all-time low of 84.46 against the US dollar.

The Forex market was closed on Friday on account of Guru Nanak Jayanti.

“This minor support for the rupee was further aided by a reduction in FII selling activity in recent days, with expectations that sell-off pressure will remain limited due to the upcoming state elections in Maharashtra.

“The rupee is expected to find support in the 84.45-84.52 range, while resistance is projected around 84.25-84.30,” said Jateen Trivedi, VP Research Analyst – Commodity and Currency, LKP Securities.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading lower by 0.06 per cent at 106.55.

Brent crude, the global oil benchmark, rose by 0.79 per cent to USD 71.60 per barrel in futures trade.

In the domestic equity market, the 30-share BSE Sensex declined 241.30 points, or 0.31 per cent, to close at 77,339.01 points, while Nifty fell 78.90 points, or 0.34 per cent, to settle at 23,453.80 points.

Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Thursday, as they offloaded shares worth ₹1,849.87 crore, according to exchange data.

On the domestic macroeconomic front, India’s merchandise exports in October rose by an impressive 17.25 per cent year-on-year, highest in over two years, to $39.2 billion, while the trade deficit widened to $27.14 billion on a sequential basis, according to the latest government data released on Thursday.

Meanwhile, the country’s forex reserves dropped by $6.477 billion to $675.653 billion for the week ended November 8, the Reserve Bank of India said on Friday.