Rupee recovers by 7 paise to end at 74.45 against dollar on stocks rally

The rupee strengthened by 7 paise to close at 74.45 against the US dollar on Friday, as a firm trend in domestic equities boosted investor sentiments.

Besides, lower crude prices in the international market also supported the local unit, forex dealers said.

WATCH | Click on Zee Business Live TV Streaming Below:

At the interbank forex market, the local unit opened at 74.36 against the greenback and later settled at 74.45, higher by 7 paise over its previous close of 74.52.

The local unit moved in a range of 74.36 to 74.54 in the day trade.

On a weekly basis, the rupee settled on a flat note.

According to Anindya Banerjee, DVP, Currency Derivatives & Interest Rate Derivatives at Kotak Securities there is a lack of direction in prices, due to a lack of dominant triggers.

On one hand the US Dollar index is trading at a fresh 52-week high, but on the other hand, Asian currencies are strengthening against the US Dollar.

"USDINR is caught between the two kinds of forces. Most of the other factors like oil prices and equity markets are mostly mixed. Hence, we are having days of range-bound trading activity," Banerjee said.

According to Emkay Global Financial Services, locally, IPO related flows have dried off and Evergrande woes persist, though so far it has managed to avoid the default, but risk appetite will remain on tenterhooks amid global inflationary pressure.

Next week is quiet on economic data front, and USDINR spot is expected to trade sideways in between 74-75, it said, adding that "only a closing below 74-73.80 may push prices towards 73.50 zone. However, 74.70-75 will act as a strong resistance."

On the domestic equity market front, the BSE Sensex ended 767.00 points or 1.28 per cent higher at 60,686.69, while the broader NSE Nifty advanced 229.15 points or 1.28 per cent at 18,102.75.

Brent crude futures, the global oil benchmark, fell 1.10 per cent to USD 81.96 per barrel.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading higher by 0.01 per cent at 95.18.
Foreign institutional investors were net sellers in the capital market on Thursday, as they offloaded shares worth Rs 1,637.46 crore, exchange data showed.