Rupee Strengthens by 8 Paise to ₹85.19 Amid FII Inflows and Trade Optimism​

The Indian rupee opened stronger at ₹85.19 against the US dollar on Friday, appreciating by 8 paise from its previous close of ₹85.27. This uptick is attributed to sustained foreign institutional investor (FII) inflows and positive developments in US-China trade discussions.​

FII Inflows Bolster Rupee

Foreign portfolio investors continued their buying spree in Indian equities for the seventh consecutive day, purchasing stocks worth ₹8,250.53 crore on Thursday. This brings the total net inflows over the past week to ₹29,450.5 crore, providing significant support to the rupee. These inflows reflect investor confidence in India's economic fundamentals amidst global uncertainties.​

Global Factors Influence Currency Dynamics

The rupee's appreciation also aligns with a softer stance from US President Donald Trump regarding China. Reports indicate that China is considering suspending its 125% tariff on certain US imports, signaling a potential easing of trade tensions. This development has positively impacted global market sentiment, indirectly benefiting emerging market currencies like the rupee.​ Tensions are still prevailing between India and Pakistan, and it might have some effect on the rupee's performance in the near future.

Market Outlook

Despite the rupee's recent gains, market experts advise caution. The dollar index remains firm, and crude oil prices have edged higher, with Brent crude trading at $66.97 per barrel. These factors could exert pressure on the rupee in the near term. Technical analysis suggests that the rupee may find support around ₹85.20 and face resistance near ₹85.60.​

In summary, the Indian rupee's strength on Friday is underpinned by robust FII inflows and optimistic signals from US-China trade talks. However, global economic variables continue to play a crucial role in determining the currency's trajectory.

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