Indian rupee gains against UAE dirham on foreign fund inflows

The Indian rupee gained 11 paise to 82.01 against the US dollar (22.34 against UAE dirham) in early trade on Wednesday tracking a positive trend in the equities and foreign fund inflows.

Forex traders said investors are focusing on India's CPI data scheduled to be released later in the day.

At the Indian interbank foreign exchange, the rupee opened at 82.08 against the dollar, then climbed to 82.01, registering a rise of 11 paise over its previous close.

On Tuesday, the rupee closed at 82.12 against the US currency.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.11 per cent to 102.08.

Brent crude futures, the global oil benchmark, advanced 0.04 per cent to $85.64 per barrel.

“The market will be focusing on India's CPI data, which is expected to come at 5.80 per cent vs the previous 6.44 per cent," said Amit Pabari, managing director, CR Forex Advisors.

However, falling inflation will push the Reserve Bank of India to pivot on the interest rate hike cycle, which could hurt the rupee going forward due to the narrowing interest rate differential between the US and India, Pabari added.

In the Indian equity market, the 30-share BSE Sensex advanced 74.07 points or 0.12 per cent to 60,231.79. The broader NSE Nifty gained 37.45 points or 0.21 per cent to 17,759.75.

Foreign Institutional Investors (FIIs) were net buyers in the capital market on Tuesday as they purchased shares worth Rs3.42 billion, according to exchange data.

(with inputs from PTI)

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