Rupee rises 52 paise against U.S. dollar as domestic markets rally and crude oil prices drop

The Indian rupee gained 52 paise to close at 93.89 against the U.S. dollar on Friday, supported by a softer greenback and falling crude oil prices.

Market Movements

At the interbank foreign exchange market, the currency opened at 94.50 and moved between an intraday high of 93.82 and a low of 94.50. This follows a minor 5 paise rise on Thursday when the rupee settled at 94.41. Foreign exchange traders pointed to strong domestic markets and worries over a slowdown in artificial intelligence spending as factors aiding the local unit. Meanwhile, the dollar index traded at 102.04, up by 0.49 percent. Brent crude futures rose 2.04 percent to $100.30 per barrel.

Equities and Expert Views

The domestic stock market saw major gains as the Sensex jumped 1,718.01 points to close at 81,028.02 and the Nifty surged 493.75 points to 25,030.35. Foreign institutional investors bought equities worth ₹14,974.68 crore on Thursday. Anuj Choudhary, a research analyst at Mirae Asset Sharekhan, stated that the rupee is expected to maintain a positive bias due to rising foreign inflows and domestic market strength, while warning that ongoing conflicts in West Asia and between Ukraine and Russia could limit sharp gains. He added that traders are keeping watch on the U.S. non-farm payrolls report and that the USD-INR spot price is projected to trade between 93.65 and 94.20.

Context

Currency values fluctuate daily based on global economic indicators, commodity prices, and foreign investment flows. When crude oil prices fall, countries like India spend less foreign exchange on oil imports, which helps support the local currency.