Rupee gains 29 paise against dollar in early trade, but crude prices limit gains

Rupee gains against US dollar

NEW DELHI: Rupee jumped nearly 0.5% against the US dollar on Wednesday, climbing to a six-week high of 94.50. The rally came as foreign currency inflows linked to the Jio IPO and gains at the Dalal Street supported the currency.

At the same time, support from the Reserve Bank of India (RBI) also helped rupee, although rising crude oil prices and a firm dollar restricted its advance.The currency began the session at 94.78 at the interbank foreign exchange market before strengthening to 94.62 against the American currency. This marked a 29-paise gain over its previous closing level.The move came after the rupee ended Monday's session at 94.91, down 2 paise against the dollar.

The forex market was shut on Tuesday for Dussehra.The Jio IPO, which opened for public subscription on Wednesday, has brought foreign dollar inflows into focus. Despite the support from these inflows, oil prices remained a concern for the rupee. Makda said elevated crude prices continued to act as a significant headwind for the domestic currency.According to Aamir Makda, commodity & currency analyst, commodity technical research at Choice Broking, "Over the course of today's session, the rupee is expected to consolidate within a trading band of 94.00 to 94.75 against the dollar.”

The dollar index, which tracks the US currency against a basket of six currencies, edged up 0.06 per cent to 101.58. Brent crude futures, meanwhile, climbed 1.42 per cent to $110.33 per barrel.On the domestic front, equity markets recorded gains in early trade. BSE Sensex jumped 800 points while NSE Nifty50 advanced beyond the 23,100 levels.Foreign institutional investors (FIIs), however, continued to weigh on market sentiment through their equity sales. Exchange data showed that FIIs were net sellers to the tune of Rs 1,148.64 crore on Monday.