Rupee Hits 7-Month High Against US Dollar Amid Foreign Fund Inflows

(MENAFN- IANS) New Delhi, May 2 (IANS) The rupee continued to strengthen against the US dollar, rising by 40 paise on Friday and breaching the 84-mark. This is the first time in seven months that the rupee has traded below the 84-level against the greenback.

The local currency opened at 84.09 and touched 83.90 during early trade. In the previous session, the rupee had closed at 84.49 against the dollar.

Experts say the rupee's upward movement is supported by increased foreign investments in Indian debt and equity markets, along with positive updates on trade talks between India and the United States.

“Despite the dollar index remaining firm, the rupee strengthened on expectations that India could emerge as a key alternative to China in US trade flows, boosting confidence in Indian markets,” experts mentioned.

The last time the rupee saw this level was on October 1, 2024, when it had touched 83.82 against the dollar.

After a period of global market volatility, foreign institutional investors (FIIs) have returned strongly to Indian markets.

In the last 11 trading sessions alone, FIIs have invested Rs 37,375 crore in Indian equities and bonds.

Adding to the rupee's strength is the weakness in the US dollar index, which has dropped below 100 and is hovering around 99. The dollar index reflects the performance of the US dollar against six major global currencies.

Meanwhile, in a recent interview with American media, US trade negotiator Jamieson Greer said that India and the US are close to finalising a trade agreement, though it hasn't been concluded yet.

Greer mentioned that talks are ongoing with India. "I have a standing call with India's Commerce and Industry Minister (Piyush Goyal). I sent my team to India for a week. They were here last week and I met with their chief negotiator," he stated.

Asked about US Vice-President JD Vance's visit to India, Greer referred to the announcement by the two sides of a framework for trade negotiations between the two sides.

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