Rupee jumps 82 paise to 94.96 against US dollar in early trade

The rupee appreciated 82 paise to 94.96 against US dollar in early trade on Tuesday, supported by various RBI measures aimed at reducing immediate dollar demand and curbing excessive positions in the foreign exchange market.

Forex traders said measures including a dedicated dollar window for oil marketing companies through designated banks and higher costs for certain foreign exchange hedging transactions, are expected to reduce dollar demand in the spot market and curb speculative positions against the rupee.

At the interbank foreign exchange market, the rupee opened at 95.53, then gained ground to touch 94.96, registering a gain of 82 paise over its previous close.

On Monday, the rupee appreciated 93 paise, logging its steepest single-day gain in more than six months, to close at 95.78 against the US dollar.

"With the RBI's measures supporting the rupee, we expect USD/INR to move towards 95.00-94.80 range in the near term," CR Forex Advisors MD Amit Pabari said.

The RBI on Saturday tightened rules governing forex derivatives trades to curtail speculative bets against the rupee and asked banks to create a 20 per cent reserve for dollar purchases of over USD 2 million.

In another set of measures announced on Saturday on the derivatives front, the RBI said authorised dealers (AD) should not permit users to rebook any foreign exchange derivative contract involving the INR, whether deliverable or non-deliverable, which has been cancelled.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading lower by 0.15 per cent at 102.43.

Brent crude, the global oil benchmark, was trading lower by 1.11 per cent at USD 105.47 per barrel in futures trade.

On the domestic equity market front, Sensex climbed 305 points to 72,224.15, while the Nifty was up 93.40 points to 22,458.50.

Foreign Institutional Investors (FIIs) offloaded equities worth Rs 1,708.48 crore on a net basis on Monday, according to exchange data.

On the macroeconomic front, retail inflation in the country rose sharply to 5.54 per cent in September on the back of high onion and other food prices, remaining just within the RBI's tolerance band, government data released on Monday showed.

The consumer price index (CPI) based headline inflation was 4.83 per cent in August, according to the National Statistics Office (NSO).
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