Rupee extends gains, settles 13 paise higher at 86.40 against U.S. dollar

Rupee gains against dollar on favorable cues, softening crude oil prices, and weakening American currency index.

The rupee extended its recovery for the second straight session and settled with a gain of 13 paise at 86.40 (provisional) against the U.S. dollar on Wednesday (January 15, 2025), tracking favourable cues from domestic equity markets and softening crude oil prices.

The American currency index also descended from a record peak, adding to the gaining momentum in the local unit, though it remained under pressure from continuous exit of foreign institutional investors, forex traders said.

At the interbank foreign exchange, the rupee opened at 86.50 and slipped to the intraday low of 86.55 against the greenback. It also touched A high of 86.28 before ending the session at 86.40 (provisional) against the dollar, registering a gain of 13 paise from its previous close.

On Tuesday (January 14, 2025), the rupee rebounded from its lowest-ever level and settled with a gain of 17 paise at 86.53 against the dollar.

Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan, said the rupee gained for the second consecutive session on weak US dollar and soft U.S. 10-year treasury yields. A pullback in the domestic equities and overnight decline in crude oil prices also favoured the rupee. However, FII outflows capped sharp gains.

Analysts attributed the weakening dollar to a lower-than-expected producer price index, as per the latest data released in the US.

Going ahead, Choudhary said the U.S. inflation is expected to remain elevated and it may lead to a recovery in the US dollar, which is likely to put pressure on the rupee.