Mumbai: The Indian rupee appreciated by against the US currency in the early session on Monday. The weakening of the US dollar in the overseas markets supported the Indian currency. But, sustained foreign fund outflows from Indian equities after the government’s decision to hike the tax rate on capital gains weighed on the local currency and restricted the upmove.
At the interbank foreign exchange market, the rupee opened firm at 83.70 against the US dollar. The local currency was trading at 83.72 against the US dollar, up by 2 paise. The domestic currency had recovered from its all-time low by 5 paise to settle at 83.73 against the US dollar on Friday.
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Meanwhile, the dollar index, which gauges the US dollar’s strength against a basket of six currencies, was at 104.23, marginally down by 0.08 per cent.
India’s forex reserves had jumped $ 4 billion to reach an all-time high of $ 670.857 billion for the week ended July 19. Foreign institutional investors (FIIs) were net buyers in the Indian capital markets on Friday as they purchased shares worth Rs 2,546.38 crore.
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