The rupee strengthened for the eighth consecutive session and settled 11 paise higher at 82.90 against the US dollar on Friday, supported by robust sentiments in the equity markets.
Forex traders noted that an upward movement in crude oil prices and a stronger American currency somewhat contained the appreciation of the Indian currency, even as investors remained concerned about the upcoming domestic macroeconomic data.
At the interbank foreign exchange, the rupee opened weaker at 83.08, trading between 82.86 and 83.10 against the US dollar during intra-day deals.
The currency eventually settled at 82.90 (provisional) against the dollar, marking a gain of 11 paise over its previous close. This rise occurred amid a bullish trend in domestic equities, with benchmark indices reaching lifetime highs.
In the last eight trading sessions, the rupee has added 42 paise, starting from the level of 83.32 versus the dollar recorded on January 2.
Anuj Choudhary, Research Analyst at Sharekhan by BNP Paribas, noted that the rupee gained strength due to strong domestic markets and a weaker US dollar. However, the surge in crude oil prices amid escalating tensions in the Middle East limited sharp gains.
"Fresh inflows from foreign investors may also support the rupee. However, a rise in global crude oil prices may cap sharp gains. Traders may remain cautious ahead of inflation and IIP data from India. USD-INR spot price is expected to trade in a range of Rs 82.55 to Rs 83.20," he added.
The net direct tax collection so far this fiscal has risen by 19.41 percent to Rs 14.70 lakh crore, reaching about 81 percent of the full-year target, according to the income tax department.
(With PTI inputs)
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