Rupee increases 27 paise to 83.03 against the US dollar as stocks rise.

Following continuous inflows of foreign funds and a record-breaking run in domestic stocks, the rupee gained 29 paise to settle at 83.01 (provisional) against the US dollar on Friday.

With the benchmark BSE Sensex surpassing the new milestone of 71,000, the stock markets maintained their historic run. Forex dealers reported that strong purchases by overseas investors also helped the rupee’s mood.

In relation to the dollar, the rupee opened flat at 83.30 on the interbank foreign currency market. The rupee reversed losses and soared to a high of 82.94 after touching the day’s low of 83.32 in early trade. After closing at 83.30, the rupee gained 27 paise to settle at 83.03. The rupee appreciated by 37 paise per week.

The US dollar index, which gauges the strength of the US dollar relative to a group of six other currencies, remained virtually unchanged at 101.01. The global standard oil contract, Brent crude futures, increased 0.44 percent to USD 76.94 a barrel.

Following indications from the US Federal Reserve that rates might be lowered next year, the 10-year US Treasury yield dropped below the 4% mark on Thursday. October saw a spike in the yield to 5%, the highest since 2007.

Important market indices reached fresh all-time highs on Friday, with the Sensex breaking above the 71,000 barrier. This was accompanied by strong investor sentiment stemming from positive domestic macroeconomic data and expectations of rate cuts in the upcoming year.

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