The rupee increased 18 paise to 81.93 against the US dollar in early trade on Thursday, reflecting the American currency’s widespread weakness in the foreign exchange market. Forex brokers claimed that foreign funds were also supporting the local currency.
The dollar index, which measures how strong the dollar is relative to a basket of six different currencies, increased 0.06 percent to 101.55. The international oil benchmark, Brent crude futures, saw a 0.22% fall to USD 87.14 per barrel.
Retail inflation in March reached a 15-month low of 5.66 percent, returning to the Reserve Bank’s preferred level of 6 percent, on the domestic macroeconomic front.
According to official data issued on Wednesday, India’s industrial production growth increased slightly to 5.6% in February from 5.5% in January 2023, primarily because the manufacturing, mining, and power sectors performed well.
“Overall, the USDINR is well supported between 81.75 and 80 levels as the RBI steps in to prevent sharp appreciation. Additionally, the Fed’s strategy of raising interest rates and continued geopolitical concerns are expected to have an impact on investor sentiment, and the USDINR may rebound to values between 82.50 and 82.80,” CR Forex Advisors MD-Amit Pabari said.
