New Delhi — The Indian rupee opened modestly higher against the U.S. dollar Friday, ending a three-session decline as softer American inflation data weighed on the greenback.
The rupee began trading at 96.31 per dollar, up 4 paise from Thursday’s close of 96.35.
The dollar index, which tracks the U.S. currency against six major counterparts, remained near a one-month low at about 100.7 and was headed for a weekly loss.
Weaker-than-expected U.S. inflation figures reduced expectations that the Federal Reserve would raise interest rates in the immediate term. Markets largely expect policymakers to leave rates unchanged in July, while the outlook for September remains uncertain.
The rupee’s advance was limited by rising oil prices as escalating tensions between the United States and Iran increased concerns about global energy supplies.
Brent crude futures rose 1.48% to $85.48 a barrel in early trading, while U.S. West Texas Intermediate crude gained 1.6% to $80 a barrel. Higher oil prices can pressure the rupee because India relies heavily on imported crude.
Asian stock markets also declined sharply. Japan’s Nikkei lost more than 4%, Hong Kong’s Hang Seng fell about 2%, and China’s Shanghai Composite dropped more than 1%.
Demand for safe-haven assets pushed Indian gold futures higher. August gold contracts on the Multi Commodity Exchange rose as much as 0.27% to Rs 1,40,733 per 10 grams by 9:50 a.m.
September silver futures, however, declined 0.36% to an intraday low of Rs 2,15,233 per kilogram. (Source: IANS)
