Indian Rupee spikes by 14 paise in early trade as dollar retreats on Fed commentary

• The US dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.2% lower at 103.22.
• The Indian rupee settled at a two-month low of 83.19 on Wednesday ahead of the announcement of US Fed policy.
• The crude oil prices have been inching up this month, moving from $82.6 per barrel in early March to hover around $86 in the last few days.

The Indian Rupee charted a smart comeback on Thursday morning trade, as the dollar index slumped on the latest US Fed commentary. While the US Fed kept its key interest rates unchanged, it also indicated three rate cuts this year despite sticky inflation.

The rupee went up by 14 paise to 83.05 against the US currency in early trade. It had settled at a two-month low of 83.19 on Wednesday ahead of the announcement of US Fed policy. The US dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.2% lower at 103.22.

The pair has held above 83 for the second consecutive session reinforcing the bullish sentiment, said Rahul Kalantri, VP of commodities at Mehta Equities.

“It is expected to fluctuate within the range of 82.55-83.50 for the week ahead. Our recommendation is to initiate selling positions within the range of 83.15-83.25, with a stop loss set at 83.50 on a closing basis, targeting levels of 82.94-82.70,” he added.

The Indian currency depreciated by 0.3% in March so far, tracking equity markets that have turned bearish, high crude prices —- as well as a strengthening dollar. Foreign institutional investors have been selling in the last few sessions. As of Wednesday, they sold shares worth ₹2,599.19 crore, according to exchange data.

The crude oil prices have been inching up this month, moving from $82.6 per barrel in early March to hover around $86 in the last few days. As of Thursday morning, Brent crude is trading at $85.8 per barrel.

The Indian benchmark indices opened on a positive note on Thursday with Sensex zooming by over 600 points to 72,762, and Nifty was up by 204 points to 22,043 as of 10 am.

(With PTI inputs)