Rupee inches 2 paise higher to 73.33 against US dollar in early trade

The rupee opened on a flat note and inched 2 paise higher to 73.33 against the US dollar in opening trade on Wednesday in the absence of any major data or triggers.

At the interbank forex market the rupee was trading in a narrow range. It opened at 73.39 against the US dollar, gained momentum and touched 73.33 against the greenback, higher by 2 paise over its previous close.

On Tuesday, the local unit settled at 73.35 against the greenback.

"Due to the uncertainty surrounding the outcome of the US elections, investors will refrain themselves from taking large positions and we could witness that the markets could remain within a broad trading range of 73-74," Reliance Securities said in a research note.

Further, stalled talks on US stimulus, COVID-19 vaccine uncertainty and weak Asian currencies could limit gains for the domestic unit, while, RBI mopping up flows by purchasing dollars could also keep the domestic unit from appreciating above 73 levels, the note added.

According to Abhishek Goenka, Founder and CEO, IFA Global, "In the absence of any major data or triggers, we expect range-bound trading to continue."

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.01 per cent to 93.51.

On the domestic equity market front, the BSE benchmark Sensex was trading 269.19 points lower at 40,356.32, and the broader NSE Nifty dropped 89 points to 11,845.50.

Foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 832.14 crore on a net basis on Tuesday, according to provisional exchange data.

Brent crude futures, the global oil benchmark, fell 0.19 per cent to USD 42.37 per barrel.