Rupee Gains Ground Against US Dollar in Early Trade

The Indian Rupee gained 19 paise against the US dollar in early trading today. The domestic currency is now trading at ?85.29 against the greenback.

The Rupee's rise comes after its previous close on Thursday, where it closed 10 paise lower at ?85.48 against the dollar. The Rupee started trading today at ?85.35 in the interbank foreign exchange market.

Key Drivers and Market Dynamics

A number of reasons seem to be driving the Rupee higher. Soft crude oil prices are underpinning the currency. Brent crude, the global benchmark, was down by 0.48 per cent at $63.84 a barrel in futures trade. Foreign fund flows too are supporting the Rupee. Data from the exchanges showed foreign institutional investors (FIIs) were net buyers of equities on Thursday, purchasing stocks worth ?884.03 crore.

But the Rupee gains were somewhat contained by a strong US dollar and unstable domestic share markets. The dollar index, which gauges the dollar against a basket of six benchmark currencies, was trading up at 0.16 per cent at 99.36. Experts observed that the recent dollar recovery following a US federal court's ruling was short-lived after a federal appeals court temporarily halted that ruling.

Market players are also being cautious before the release of local GDP numbers. Furthermore enhancing the overall economic scenario, the Reserve Bank of India (RBI) said in its most recent annual report on Thursday that India will continue to be the world's fastest-growing major economy even in FY 2026.

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