Mumbai, Jan 29 (PTI) The rupee gained 9 paise to settle at 72.96 against the US dollar on Friday even as the domestic equity markets closed with significant losses.
At the interbank forex market, the local unit opened at 73.01, and hit an intra-day high of 72.93 and a low of 73.01. It finally finished at 72.96, higher by 9 paise over its last close.
On Thursday, the rupee had finished at 73.05 against the American currency.
The dollar index, which gauges the greenback's strength against a basket of six currencies, advanced 0.32 per cent to 90.74.
Meanwhile, the pre-Budget Economic Survey on Friday said India's economic growth is likely to rebound with an 11 per cent expansion in the next financial year as it makes a 'V-shaped' recovery after witnessing a pandemic-led carnage.
The Gross Domestic Product (GDP) is projected to contract by a record 7.7 per cent in the current fiscal ending March 31, 2021.
The Economic Survey 2020-21 also said the agriculture sector is the only silver lining while services, manufacturing and construction were most hit by the lockdown that was imposed to curb the outbreak of the COVID-19 pandemic.
On the domestic equity market front, the BSE Sensex ended 588.59 points or 1.26 per cent lower at 46,285.77, while the broader NSE Nifty declined 182.95 points or 1.32 per cent to 13,634.60.
Foreign institutional investors were net sellers in the capital market as they offloaded shares worth Rs 3,712.51 crore on Thursday, according to exchange data.
Brent crude futures, the global oil benchmark, rose 0.41 per cent to USD 55.76 per barrel.
'The Indian Rupee appreciated on Friday and gained marginally in the first month of the new year against the US currency supported by portfolio inflows into the domestic equity markets,' said Sriram Iyer, Senior Research Analyst at Reliance Securities.
However, persistent intervention by the central bank and a broad rally on the dollar index capped gains of the currency, Iyer noted.
According to Devarsh Vakil, Deputy Head of Retail Research, it was the third consecutive strong monthly closing for the rupee. So far this month, overseas investors bought equities worth USD 3.09 billion.
'Next week will remain crucial for trend in rupee as we have two crucial events lined up, the Union Budget on February 1 and RBI monetary policy meet on February 5,' Vakil said.
Rupee is likely to remain range-bound for the next week near 73-mark. 'For medium term USDINR is having resistance at 73.50 and support at 72.75,' he noted.
'Rupee continued to consolidate in a narrow range despite weakness in domestic equities and strength in the dollar against its major crosses. Market participants remain cautious ahead of the important Union Budget and RBI policy statement that will be released next week,' said Gaurang Somaiyaa, Forex & Bullion Analyst, Motilal Oswal Financial Services.
From the US, focus will be on core PCE index and consumer sentiment data.
'Better-than-expected number could extend gains for the dollar. We expect the USD-INR (Spot) to trade sideways with a lower bias and quote in the range of 72.80 and 73.50,' Somaiyaa noted. PTI DRR ABM ABM