Rupee closes flat at 72.52 against dollar on strong dollar

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Mumbai, Mar 19 (PTI) The rupee ended on a flat note against the US dollar on Friday as a stronger dollar offset gains from weak crude oil prices and FII inflows.

A firm trend in domestic equity markets also supported the rupee.

At the interbank forex market, the local unit opened lower at 72.57 against the greenback and witnessed an intra-day high of 72.46 and a low of 72.58.

It finally closed at 72.52 against the American currency, registering a rise of just 1 paisa over its previous close. The rupee had ended at 72.53 against the US dollar on Thursday.

'INR gained back its strength today amid rise in risk appetite in the domestic markets. Further, rupee gained strength on FII inflows and decline in crude oil prices.

'Crude oil prices fell on worries that new wave of Covid-19 infections across Europe may push authorities to implement new lockdowns hampering economic recovery,' Saif Mukadam, Research Analyst, Sharekhan by BNP Paribas, said.

Additionally, all three major central banks, US Federal Reserve, Bank of England and Bank of Japan maintained its easy monetary policy. Rupee may trade in the range of 72.25 to 73.00 in next couple of sessions, Mukadam noted.

On the domestic equity market front, the BSE Sensex ended 641.72 points or 1.30 per cent higher at 49,858.24, while the broader NSE Nifty surged 186.15 points or 1.28 per cent to 14,744.00.

The dollar index, which gauges the greenback's strength against a basket of six currencies, advanced 0.08 per cent to 91.94.

Brent crude futures were trading lower at USD 63.10 per barrel.

Foreign institutional investors remained net buyers in the capital market as they bought shares worth Rs 1,258.47 crore on Thursday, according to exchange data.

'The forex market is still jittery about Fed’s move and there are speculations of an early rate-hike which are keeping the US Yields higher. There is also an upside risk to the rapid spread of coronavirus which will keep USDINR spot afloat.

'But until the spot is trading below 73 zone, the trend will be sideways to bearish within 72.10-72.80. The USDINR spot has to consistently trade above the resistance of 73 to breach 73.20-73.25 zone,” Rahul Gupta, Head Of Research- Currency, Emkay Global Financial Services, said. PTI BAL MR MR