Rupee spurts by 42 paise to 76.20 against U.S. dollar on stocks rally

The U.S. Federal Reserve likely to raise rates by 25bps.

The rupee spurted by 42 paise to a nearly two-week high of 76.20 against the U.S. dollar on Wednesday, tracking positive domestic equities and Asian currencies ahead of the U.S. Federal rate hike decision.

At the interbank forex market, the local unit opened at 76.40 against the greenback and witnessed an intra-day high of 76.19 and a low of 76.44.

The rupee quoted at 76.20, registering a rise of 42 paise over its previous close of 76.62.

"Rupee appreciated against U.S. dollar taking cues from stronger Asian currencies and risk-on moods. Forex markets are little tepid ahead of Wednesday's Fed decision while U.S. 10-year bond yields retraced after touching 2.20 %, the highest level since 2019," said Dilip Parmar, Research Analyst, HDFC Securities.

The U.S. Federal Reserve likely to raise rates by 25bps, as well as penciling further such hikes this year amid higher inflation.

Spot USDINR could find support in the range of 76 to 75.70, while resistance is around 76.70, Mr. Parmar added.

Meanwhile, the dollar index, which measures the greenback's strength against a basket of six currencies, fell 0.38 % to 98.72.