Rupee gains 12 paise to 94.72 against dollar in early trade

Rupee gains reached 12 paise against the US dollar in early trading on Tuesday, taking the currency to 94.72 at the interbank foreign exchange market. Softer crude oil prices and continued overseas investment in Indian equities supported the recovery, according to market reports.

The rupee opened at 94.68 and strengthened as far as 94.60 during the session described in the report. It had finished Monday at 94.84, down eight paise, after appreciating by 50 paise on Friday.

The early improvement therefore reversed part of Monday's decline. The quoted exchange rates represent the opening phase of Tuesday's trading rather than a closing value.

Foreign buying supports currency as dollar stays firm

Foreign Institutional Investors bought a net Rs 3,114.68 crore of equities on Monday, according to exchange figures. That marked their second successive session as net buyers.

Oil also provided support, with Brent crude trading slightly lower at $104.76 a barrel. Discussions between Iranian and Qatari officials had raised hopes of movement towards resolving the West Asia conflict and steadier energy supplies, the reports said.

Rupee gains were constrained by strength in the US currency ahead of the American midterm elections. The dollar index, which tracks it against six major currencies, rose 0.03 per cent to 101.65.

Indian shares were also higher in the early session. The Sensex advanced 551.77 points, or 0.73 per cent, to 76,244.55.

The Nifty gained 129.60 points, equivalent to 0.55 per cent, to reach 23,570.40. Those equity readings accompanied the foreign exchange moves reported during early trade.

The session brought together support from foreign inflows and easing oil prices, while the firm dollar limited the currency's advance. Investors remained cautious as the US election approached.

Also read: Indian equities outperform Asian peers in October: Goldman Sachs | Binance hack disclosure deepens Bitcoin fall below $77,000