Rupee Appreciates Against the Dollar

The rupee appreciated by 16 paise to settle at 85.76 against the US dollar on Tuesday, buoyed by a weaker greenback and softer crude oil prices globally. However, the currency's upward movement was capped by persistent foreign fund outflows and uncertainty surrounding the ongoing India-US trade negotiations, as per forex dealers.

Market Movements and Expert Insights

At the interbank foreign exchange market, the rupee opened at 85.97, fluctuating between 85.75 and 85.97 during the session before closing at 85.76. "The Reserve Bank of India has been guarding the rupee at the 86.00 level," noted Anil Kumar Bhansali of Finrex Treasury Advisors LLP, predicting a range of 85.50–86.10 for the rupee in the coming days.

Global Factors Influencing the Rupee

The dollar index fell by 0.11% to 97.97, aiding emerging market currencies, while Brent crude prices dropped 0.43% to $68.91 per barrel, easing India's import bill pressures.

Trade Talks and Economic Indicators

Concerns over India-US trade negotiations and steady merchandise exports at $35.14 billion in June, alongside a narrowed trade deficit, influenced the rupee's performance. Domestic equities saw gains, with the Sensex and Nifty closing higher, and foreign institutional investors turning net buyers.