MUMBAI: The Indian rupee snapped its three-day losing streak to settle 14 paise higher at 74.44 against the US dollar on Wednesday, in line with positive Asian peers against the greenback.
The rupee gain, however, was restricted by a host of factors including weak domestic equities, surging crude oil prices, and sustained selling by FIIs in domestic markets. At the interbank foreign exchange market, the rupee opened lower at 74.70 a dollar, registering a decline of 12 paise from the last close.
During the day, it pared losses and witnessed an intra-day high of 74.32. The domestic unit finally settled at 74.44 against the American currency, up 14 paise over its last close. On Tuesday, the rupee slumped by 33 paise to close at a two-week low of 74.58 against the US dollar.
"The Indian rupee gained the most in a week following stronger regional currencies. Domestic bond markets saw a recovery on suspected intervention by the central bank, which helped in rupee recovery," said Dilip Parmar, Research Analyst, HDFC Securities.
"Also, the relentless selling of dollars from corporates caused speculative unwinding of positions," Parmar said. "Spot USD/INR is expected to consolidate within the 74.25 to 74.80 band in the coming days," he added.
"Rupee traded volatile with weak opening trend in the morning session and picked up strength later, taking support near 74.60; and thereafter rallied towards 74.40 on the back of weakness in the dollar," Jateen Trivedi, Senior Research Analyst at LKP Securities, said.
"Technical resistance for USD/INR also supported rupee from 74.60 where it has shown resistance to cross earlier in Jan 2022 start, and going ahead market shall be in the range of 74.25-74.60," he added.
Meanwhile, the US dollar index, which measures the greenback's strength against the basket of six currencies, fell 0.11 per cent to 95.62. Brent crude futures, the global oil benchmark, jumped 0.94 per cent to USD 88.33 per barrel.
Foreign institutional investors remained net sellers in the capital market on Tuesday, as they offloaded shares worth Rs 1,254.95 crore, as per stock exchange data.
On the domestic equity market front, the BSE Sensex ended 656.04 points or 1.08 per cent lower at 60,098.82, while the broader NSE Nifty declined 174.65 points or 0.96 per cent to 17,938.40.