Rupee vs Dollar: Domestic currency gains 7 paise to settle at 83.23 against American dollar

Currency market update: The rupee (INR) settled at 83.23 (provisional) against the US dollar on Thursday, January 4. Helped by a bullish trend in domestic equities and the weakness of the American currency in the overseas market, the local currency registered a gain of seven paise for the day from its previous close. Throughout the session, the domestic currency oscillated within a range of 83.21 - 83.32.

At the interbank foreign exchange, the rupee began the day at 83.30 against the dollar and fell to as low as 83.32 during the session before settling at 83.23 (provisional) against the greenback for the day. The domestic currency touched the peak of 83.21 against the greenback during intra-day deals.

The rupee gained for the second day in a trot following a weaker greenback after mixed signals from the Federal Open Market Committee (FOMC) meeting minutes.

"Better-than-expected service PMI number pushed the euro higher versus the US dollar. The rupee also accumulated the gain along with other Asian currencies after Eurozone data. However, the local unit trimmed the afternoon gains amid higher crude oil prices and importers' dollar demand," said PTI citing Dilip Parmar, Research Analyst, HDFC Securities, adding that "Spot USD/INR is expected to consolidate between 83.10 and 83.50".

The dollar index — which measures the value of the American currency against six peers other than the rupee — was last seen trading 0.32 lower at 102.16.

Global oil benchmark Brent crude futures climbed 1.05 per cent to USD 79.07 per barrel at the last count.

In contrast to this, domestic equity benchmarks Nifty50 and Sensex declined by 0.66 per cent - 0.69 per cent. The 30-share benchmark BSE Sensex surged 490.97 points for the day to settle at an all-time high of 71,847.57 points while the broader NSE Nifty advanced 141.25 points to settle at 21,658.60 points.

On Wednesday, January 3, the rupee had settled 2 paise higher at 83.30 against the American dollar, a day after closing at a loss of 11 paise.

According to exchange data, foreign institutional investors (FIIs) were net sellers in the capital markets on Wednesday as they sold shares worth Rs 666.34 crore.

On the domestic macroeconomic front, India's manufacturing sector growth fell to an 18-month low in December amid a softer increase in factory orders and output despite minimal inflation.

With inputs from PTI