Rupee Gains 16ps To 85.39/$

Mumbai: The rupee appreciated 16paise to settle at 85.39 against the US dollar on Monday, supported by a weak American currency and on expectations of a further reduction in key interest rate by the Reserve Bank. However, a sharp gain in the local unit was prevented due to volatile equity markets, outflow of foreign funds and higher crude oil prices, forex traders said. RBI’s Monetary Policy Committee (MPC) will begin the deliberations on its next bi-monthly policy on June 4 and the outcome is scheduled to be announced on June 6. At the interbank foreign exchange, the domestic unit opened at 85.55 and moved between a high of 85.30 and low of 85.55 against the greenback during the day.

The unit ended the session at 85.39, registering a gain of 16paise from its previous closing level. On Friday, the rupee ended 7paise lower at 85.55 against the dollar. Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan Choudhary said that the surge in crude oil prices weighed on the rupee at higher levels. Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading lower by 0.55 per cent at 98.71. According to analysts, the US dollar fell on trade uncertainty after US President Donald Trump announced plans to double duties to 50 per cent on import of steel and aluminium.