Rupee trades in narrow range against US dollar

The rupee witnessed a range-bound trading against the US dollar in early trade on Wednesday, as the support from positive macroeconomic data was negated by elevated crude oil prices and a firm American currency.

Forex traders said domestic retail inflation data and industrial production figures were better than market expectations and supported investors’ sentiments.

However, investors are awaiting cues from the CPI data from the US to know the path the US FED will tread in its fight for lower inflation.

At the interbank foreign exchange, the rupee was trading in a narrow range. It opened at 82.92 against the dollar. It touched a low of 82.95 against the American currency in initial trade.

On Tuesday, the rupee closed at 82.95 against the US currency.

Meanwhile, the dollar index fell marginally by 0.05 per cent to 104.65.

Brent crude futures, the global oil benchmark, was trading 0.21 per cent higher at USD 92.25 per barrel.

“With a strong pipeline of inflows and active RBI, the rupee is likely to move towards 82.50 once the 82.80 mark is taken out. On the upside, 83.25 shall remain a strong resistance bar to breach,” CR Forex Advisors MD Amit Pabari said.

In the domestic equity market, the BSE Sensex declined 6.07 points or 0.01 per cent to 67,215.06. The NSE Nifty was up 1.80 points or 0.01 per cent to 19,995.00.

Foreign Institutional Investors (FIIs) were net sellers in the capital market on Wednesday as they offloaded shares worth Rs 1,047.19 crore, according to exchange data.

India’s industrial production growth rose to a five-month high of 5.7 per cent in July, mainly due to good showing by the manufacturing, mining and power sectors, according to an official data released on Tuesday.

Retail inflation declined to 6.83 per cent in August after touching a 15-month high of 7.44 per cent in July, mainly due to softening prices of vegetables, but still remains above the Reserve Bank’s comfort zone.