The Indian rupee traded 2 paise higher at 83.32 against the US dollar in early trade on Monday amid softness in American currency and a drop in crude oil prices. The local unit opened 4 paise higher at 83.30 a dollar as compared to previous close of 83.34.
The dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading lower by 0.04% at 105.82.
On Friday, the rupee ended at a record low at 83.34 a dollar. The local unit had hit its lifetime low of 83.42 to the dollar during the session.
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Persistent outflows of foreign funds and a weak trend in the domestic equities weighed on the local unit, forex traders said.
“We expect the RBI to intervene to bring it within the 83.20-83.30 range. We otherwise expect a range-bound session with volumes being low on account of the festive season,” India Forex And Asset Management Pvt Ltd (IFA Global) said in a research note.
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Meanwhile, crude oil prices declined on renewed concerns over waning demand in the United States and China dented market sentiment.
Brent crude futures for January fell 1.01% to $80.61 a barrel, while the US West Texas Intermediate (WTI) crude futures for December declined 1.02% to $76.38.
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On the domestic side, the benchmark equity indices traded half a percent lower on Monday. The Sensex traded 375.80 points, or 0.58%, lower at 64,883.65, while the Nifty 50 was down 102.30 points, or 0.52%, at 19,423.25.
India’s forex reserves jumped by $4.672 billion to $590.783 for the week ended November 3, the Reserve Bank said on Friday.
Foreign institutional investors were net sellers in the capital market on Friday as they offloaded shares worth ₹190.06 crore, according to exchange data.
(With inputs from PTI)
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