Rupee rises 17 paise to 86.28 against US dollar in early trade
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading lower by 0.94 per cent at 108.31
PTI
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MUMBAI: Rupee appreciated 17 paise to 86.28 against the US dollar in morning trade on Tuesday, as the US dollar index and crude oil prices retreated from their elevated levels.
Forex traders said the dollar weakened from its 109 levels but clawed back to 108.31 as Donald Trump declared tariffs against Canada and Mexico in the near future but stopped short of declaring any tariffs against China.
While uncertainty eased slightly, concerns regarding tariffs still lingered in the background, as the traders began to adjust their expectations, betting that even if tariffs were imposed, they would likely be less aggressive, traders said.
At the interbank foreign exchange, the rupee opened at 86.28, registering a rise of 17 paise from its previous close of 86.45 against the greenback. The local unit also touched 86.43 against the US dollar initial trade.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading lower by 0.94 per cent at 108.31.
Brent crude, the global oil benchmark, fell by 0.05 per cent to USD 80.11 per barrel.
India's markets found themselves caught between pressure and promise. The rupee has been pressured by consistent foreign institutional outflows, totaling a whopping USD 6.73 billion this month, CR Forex Advisors MD Amit Pabari said.
"However, the rupee retraced to 86.20 levels as US bond yields softened. Yet, hope persists as a promising budget outlook and a strong earnings season painted a picture of recovery," Pabari added.
On the domestic equity market front both the benchmark indices Sensex and Nifty witnessed a highly volatile trade. The 30-share sensitive index Sensex after opening on a positive note slipped in the negative territory and was trading 111.83 points or 0.15 per cent down at 76,961.61 in early trade. Similarly, the wide-based Nifty trading was down 1.90 points or 0.01 per cent at 23,342.85 after opening on a positive note.
Foreign Institutional Investors (FIIs) remained net sellers in the capital markets on Monday, as they offloaded shares worth Rs 4,336.54 crore, according to exchange data.
