Rupee appreciates 10 paise to 67.53 against US dollar

NEW DELHI: The rupee rose 10 paise to 67.53 against the US dollar in early trade on Monday amid positive cues from other Asian currencies.

The domestic currency had closed 39 paise higher at 67.63 on Friday on fresh dollar selling by banks and exporters.

Crude prices have been rising of late. On Monday, Brent crude climbed above $32 a barrel mark. A recovery in crude prices has raised hopes that the redemption pressure in emerging market (EM) funds would ease going ahead.

Meanwhile, all eyes are on the forthcoming two-day policy review by the US Federal Reserve that begins on Tuesday. While it is largely believed that the Fed will hold on to its policy rate for now, a March rate hike is not ruled out by experts.

A rise in the US dollar in anticipation of a rate hike may lift dollar against global currencies. Already, the greenback has been rising against a basket of major currencies since last week after the ECB hinted at further stimulus to the euro zone in March.

“I think rupee will depreciate against dollar and there is still a lot of catch up that needs to happen with other emerging market currencies,” said Govindarajan Chellappa, HoR at Jefferies India.

But for now, the momentum is positive.

On Monday, most Asian currencies were trading higher against the greenback. Taiwanese dollar advanced 0.55 per cent, followed by Korean won (up 0.32 per cent), Japanese yen (up 0.20 per cent) and Singapore dollar (up 0.10 per cent). That baht and Philippine peso added 0.07 per cent. The Chinese yuan stood almost flat at 6.5791.

The dollar index, which tracks the movement of dollar against a basket of six major world currencies, stood at 99.43.