Rupee settles 4 paise higher at 83.97 against US dollar

Mumbai, Sep 05: The rupee traded in a narrow range and settled for the day higher by 4 paise at 83.97 against the US dollar on Thursday due to weakening of the American currency in the overseas market and an overall drop in crude oil prices.

Forex traders said the domestic unit witnessed a slight negative bias on weak global equities and concerns over global economic growth. Moreover, dollar demand from importers also dented investor sentiments.

At the interbank foreign exchange market, the local unit opened at 83.98 and witnessed an intraday high of 83.97 against the American currency.

The domestic unit finally settled for the day at 83.97, registering a gain of 4 paise from its previous close.

On Wednesday, the rupee breached the crucial 84-mark for the second time within a month and settled 3 paise lower at 84.01 against the American currency.

“The Indian rupee which continued to drop to a record low witnessed a range-bound trading session as it stayed wedged between negative global cues and intervention from the central bank,” said Maneesh Sharma, AVP - Commodities & Currencies, Anand Rathi Shares and Stock Brokers.

Sharma further noted that the rupee was pressured by dollar demand from importers for meeting their immediate and futures payments. There have been several instances since last month wherein the Reserve Bank defended the rupee near 84 levels.

Sharma said data from RBI also showed foreign exchange reserves hit a record high of USD 681.69 billion at the end of last month revealing the central bank has been buying dollars amid expectations of rate cuts by the US Federal Reserve.