Rupee recovers from record low to close 4 paise higher at 88.11 against US dollar

Mumbai: The rupee recovered slightly from its record low level and ended with a gain of 4 paise at 88.11 (provisional) against the US dollar on Wednesday aided by strong foreign fund inflows and a weaker greenback.

Hopes of a breakthrough in India-US trade talks and positive sentiments in domestic equity markets supported the local unit while rise in crude oil prices capped gains, forex traders said.

At the interbank foreign exchange, the rupee opened at 88.14 against the US dollar and traded in a narrow range of 88.06-88.19 before settling at 88.11 (provisional), up 4 paise from its previous close.

The rupee had pared initial gains and dropped 6 paise to revisit its record low of 88.15 against the US dollar on Tuesday. On Friday, the rupee touched the lowest-ever intra-day level of 88.38 but pared losses to settle 3 paise higher at Rs 88.09 against the US dollar.

"The rupee was within a range as US President Donald Trump said tariff talks between India and the US are on, while on the other hand he asked Europe to impose 100 per cent tariffs on buyers of Russian oil, which he would then reciprocate," Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP, said.

"The RBI being a seller of dollar at 88.20/30 levels, the pair was range-bound with lower levels getting well bid and higher levels getting sold off," Bhansali said, adding that the domestic unit is expected to be in a similar range of 87.90 to 88.40 on Thursday.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was down 0.04 per cent to 97.74.

Brent crude, the global oil benchmark, was trading 0.89 per cent higher at USD 66.98 per barrel in futures trade.

On the domestic equity market front, Sensex rose 323.83 points to settle at 81,425.15, while Nifty was up 104.50 points to 24,973.10.

Foreign Institutional Investors bought equities worth Rs 2,050.46 crore on Tuesday, according to exchange data. PTI TRB HVA