Rupee Rises to 85.39 Amid Global Trade Optimism and Falling Crude Prices
- Rupee appreciated by 16 paise to close at 85.39 against the US dollar, supported by a weaker greenback and declining crude oil prices.
- Global trade optimism surged after the US-Vietnam trade agreement, boosting Asian currencies including the rupee.
- India’s services sector growth hit a 10-month high in June, with the HSBC Services PMI rising to 60.4 amid strong demand and job creation.
The Indian rupee appreciated by 16 paise to close at 85.39 against the US dollar on Friday, bolstered by a decline in the American currency in global markets and a softening in crude oil prices. The rupee’s upward momentum was further supported by renewed hopes surrounding global trade deals.
Forex traders noted that Asian currencies, including the Indian rupee, strengthened following US President Donald Trump's announcement of a trade agreement with Vietnam. The move sparked optimism about the possibility of more such deals before the July 9 deadline, adding a positive tone to regional currency markets.
At the interbank foreign exchange market, the rupee opened at 85.44 against the dollar. It touched an intra-day high of 85.30 and a low of 85.50, before settling at 85.39, marking a 16-paise gain over its previous close of 85.55.
On Thursday, the rupee had edged up 7 paise after paring early losses, signaling a mild recovery. Market analysts expect the rupee to continue gaining traction, although sharp appreciation may be capped due to lingering uncertainty over global trade tariffs.
“We expect the rupee to gain on falling US dollar and weak tone in crude oil. However, uncertainty over trade tariffs may cap sharp gains,” said Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan. He added that the USDINR spot price is likely to trade between 85.10 and 85.70 in the near term.
The US dollar index, which measures the greenback’s strength against a basket of six major currencies, fell by 0.24% to 96.94, while Brent crude futures dropped 1.18% to USD 67.99 per barrel.
On the domestic equity front, the BSE Sensex climbed 193.42 points, or 0.23%, to close at 83,432.89. The NSE Nifty also rose 55.70 points, or 0.22%, ending the day at 25,461.00.
Meanwhile, India’s services sector reported its strongest growth in ten months in June. The HSBC India Services PMI rose to 60.4 from 58.8 in May, driven by a sharp rise in new business orders, increased international sales, and higher employment.
