The rupee appreciated by 2 paise to 83.23 against the U.S. dollar in early trade on October 18 on the back of a weaker American currency and an inflow of foreign funds in the domestic equity markets.
Forex traders said surging crude oil prices and negative trends in equity markets, however, capped the rise in the domestic currency.
At the interbank foreign exchange, the domestic unit opened at 83.24 against the dollar and then inched up to 83.23, registering a gain of 2 paise over its previous close.
On October 17, the rupee settled at 83.25 against the U.S. dollar.
Analysts expect the rupee to stay in a narrow range as traders may take cues from retail sales and industrial production data from the U.S. Data on the U.S. crude weekly inventory, China’s GDP, industrial production, and U.K. and European region inflation are also awaited.
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Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.07% to 106.18.
Brent crude futures, the global oil benchmark, witnessed a sharp rise of 2.10% to $88.48 per barrel.
In the domestic equity market, the 30-share BSE Sensex was trading 110.73 points or 0.17% lower at 66,317.36. The broader NSE Nifty declined 24.75 points or 0.12% to 19,786.75.
Foreign Institutional Investors (FIIs) were net buyers in the capital markets on October 17 as they purchased shares worth ₹263.68 crore, according to exchange data.