Indian twenty rupee currency notes are displayed at a roadside currency exchange stall in New Delhi. File
| Photo Credit: Reuters

The rupee entered its third week of rally and appreciated 6 paise to 83.46 against the U.S. dollar in early trade on Monday (September 23, 2024), tracking positive momentum in domestic equity markets amid a massive inflow of foreign funds.

“However, an upward movement in the crude oil prices and a strengthening greenback against major overseas rivals capped a sharp rise in the Indian currency,” forex traders said.

At the interbank foreign exchange market, the Indian currency opened at 83.44 and fell to 83.49 before trading again at 84.46 against the greenback, registering a gain of 6 paise higher than its previous closing level.

The local unit gained 13 paise to settle at 83.52 against the U.S. dollar on Friday (September 20, 2024).

The Indian currency has been on a recovery path since September 11 when it had settled at 83.99 against the American currency, a tad higher than the lowest level of 84.09 recorded on August 5.

The upward move of the Indian currency was attributed to the U.S. Federal Reserve’s decision to reduce the benchmark interest rate by 0.50% last week and positive commentary by the Fed chair about the American economy.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was up by 0.07% to 100.49.

Brent crude, the international benchmark, advanced 0.74% to $75.04 per barrel in futures trade.

In the domestic equity market, the 30-share BSE Sensex climbed 224.99 points, or 0.27%, to an all-time high of 84,769.30, while the Nifty advanced 86.20 points, or 0.33%, to hit its new peak of 25,877.15. On Friday (September 20, 2024), both the indices surged more than 1% and ended at their highest levels.

Foreign Institutional Investors (FIIs) were net buyers in the capital markets on Friday (September 20, 2024), as they purchased shares worth ₹14,064.05 crore, according to exchange data.

India’s forex reserves rose by $223 million to a new all-time high of $689.458 billion for the week ended on September 13, according to the Reserve Bank data released on Friday (September 20, 2024).