Rupee trades in narrow range against U.S. dollar in early trade

The rupee witnessed range-bound trading in initial deals against the U.S. dollar on March 11, as the support from fresh foreign fund inflows was negated by a negative trend in domestic equities.

Forex traders said the rupee exhibited strength supported by a weak dollar and easing crude oil prices.

At the interbank foreign exchange, the rupee opened at 82.74 against the dollar, but soon pared the losses and touched 82.64 against the greenback in initial trade, higher by 3 paise from its previous close.

On Thursday, the rupee climbed 16 paise to settle at 82.67 against the U.S. dollar.

The forex market was closed on Friday for Mahashivratri.

The dollar index, which gauges the greenback’s strength against a basket of six currencies, was at 102.72, higher by 0.02%.

Brent crude futures, the global oil benchmark, fell 0.67% to $81.53 per barrel.

According to Anil Kumar Bhansali, Head of Treasury and Executive Director Finrex Treasury Advisors LLP, rupee is expected to move in a range of 82.68 to 82.88 with a slow appreciation bias as inflows are expected to dominate the sessions.

“As many as seven IPOs are out for grabs in this week while eight firms will list on the bourses in India,” Mr. Bhansali said. Meanwhile, the European Free Trade Association (EFTA) States — Iceland, Liechtenstein, Norway, and Switzerland — has signed a Trade and Economic Partnership Agreement (TEPA) with India. Under the mega trade pact, the four European countries are looking at making an investment of $100 billion in India over the next 15 years.

In the domestic equity market, the 30-share BSE Sensex was trading 114.49 points or 0.15% lower at 74,004.90 points. The broader NSE Nifty was down 21.60 points or 0.1% to 22,471.95 points.

Foreign institutional investors (FIIs) were net buyers in the capital markets on Thursday as they bought shares worth ₹7,304.11 crore, according to exchange data.

Meanwhile, India’s forex reserves jumped $6.55 billion to $625.626 billion for the week ended March 1, the Reserve Bank of India said on Friday. In the previous reporting week, the overall reserves had risen by $2.975 billion to $619.072 billion.