MUMBAI: The rupee rose 8 paise to close at 70.86 against the US dollar on Monday as the upcoming US-China trade deal signing kept global market sentiment upbeat.
This was the fifth straight session of gains for the domestic currency, during which it has appreciated by 106 paise.
At the interbank foreign exchange market, the local unit opened on a strong note at 70.82, and shuttled between a high of 70.75 and a low of 70.93 during the day. It finally ended at 70.86, higher by 8 paise over its previous close.
The rupee had settled at 70.94 against the US dollar on Friday.
Emerging market currencies appreciated as investors looked forward to the signing of the first phase of the much-anticipated US-China trade deal later this week.
The phase one of the trade deal with China includes the country buying $200 billion worth of additional American products, US Treasury Secretary Steven Mnuchin said on Sunday.
A positive trend at the domestic equity markets and easing crude oil prices further supported the local unit, forex traders said.
"Rupee continued to trend higher against the US dollar following extended gains in domestic equities and on back of de-escalation of geopolitical tension between US and Iran," said Gaurang Somaiyaa, forex & bullion analyst, Motilal Oswal Financial Services.
Somaiyaa further noted that market participants will be keeping an eye on the inflation number and an uptick could keep gains capped for the currency.
The dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.13 per cent to 97.48.
Foreign institutional investors (FIIs) remained net buyers in the capital markets, purchasing shares worth Rs 68.24 crore on Monday, according to provisional exchange data.
Brent crude futures, the global oil benchmark, fell 0.18 per cent to trade at $64.86 per barrel.
The 10-year government bond yield was at 6.60 per cent on Monday.
On the domestic market front, the 30-share BSE sensex settled at a new closing peak of 41,859.69, up 259.97 points, or 0.62 per cent. The broader NSE Nifty closed 72.75 points, or 0.59 per cent, higher at 12,329.55 -- its new closing record.
The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 71.1136 and for rupee/euro at 79.0020. The reference rate for rupee/British pound was fixed at 93.0583 and for rupee/100 Japanese yen at 64.90.
Source: timesofindia.indiatimes.com