The rupee increased by 12 paise to 77.93 against the U.S. dollar in opening trade on Monday as soften crude oil prices supported the local unit. However, unabated foreign fund outflows, a dull trend in domestic equities and strong American dollar overseas restricted the gain, forex dealers said.
At the inter-bank foreign exchange, the rupee opened strong at 77.98 against the U.S. dollar, then inched higher to price 77.93, registering a rise of 12 paise over the previous close. In the last session, the rupee advanced 5 paise to settle at 78.05 against the U.S. dollar.
Meantime, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.30% to 104.38. Global oil benchmark Brent crude futures declined 0.26% to USD 112.83 per barrel. Meanwhile, most of the Asian and emerging market peers have started marginally stronger on Monday morning and supported the local unit.
The Indian Rupee opened slightly stronger against the U.S. dollar after crude oil prices suffered the biggest decline in more than a month on concerns over the demand outlook amid weak economic prospects, said Sriram Iyer, Senior Research Analyst at Reliance Securities. However, dollar remained elevated, and constant portfolio outflows could keep the rupee’s appreciation bias capped, he noted.