Inr Extends Recovery Taking Positive Cues From Local Equities

The Indian rupee extends recovery for the second straight session and settled with a gain of 13 paise at 86.40 (provisional) against the US dollar on Wednesday, tracking favourable cues from domestic equity markets and softening crude oil prices. The benchmark S&P/BSE Sensex edged up by 224.45 points, or 0.29 percent, to 76,724.08 while the broader NSE Nifty index closed up 37.15 points, or 0.16 percent, at 23,213.20. The dollar index is also trading slightly on the back foot on Wednesday as US PPI data came in softer-than-expected sparking fresh possibility for Fed to cut rates. Data published on Tuesday showed that the US annual PPI rose 3.3% in December, missing the expected 3.4% growth, while the core PPI inflation rose to 3.5% in the same period, compared to the estimates of 3.8%. Investors are all eyes upon the release of the all-important US Consumer Price Index (CPI) data for December, which is expected to provide fresh insights on the US Federal Reserve's (Fed) interest rates trajectory. Currently, DXY that measures the greenback against a basket of currencies is seen quoting at 108.90, down 0.20% on the day and off recent fresh two-year peaks. At the interbank foreign exchange, the rupee opened at 86.50 and slipped to the intraday low of 86.55 against the greenback. It also touched A high of 86.28 before ending the session at 86.40 (provisional) against the dollar, registering a gain of 13 paise from its previous close.

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