Rupee gains 26 paise to 70.86/USD in early trade as Fed keeps rates unchanged

The rupee appreciated by 26 paise to 70.86 against the US dollar in opening trade Thursday, driven by weakening of the greenback in overseas markets after the US Fed kept interest rate unchanged.

The US dollar weakened in overseas market after the Federal Reserve left the key US lending rate unchanged on Wednesday, and said it would be "patient" about making any further changes.

Besides selling of the American currency by exporters, forex traders said fresh foreign fund inflows and positive opening in domestic equities also supported the rupee up move, while surging crude oil prices restricted the uptrend.

The rupee opened strong at 70.92 at the interbank forex market then gained further ground and touched 70.86 amid weakening of the American currency, displaying gains of 26 paise over its last close.

The rupee Wednesday had weakened by just 1 paise to close at 71.12 against the US dollar.

Foreign funds purchased shares worth Rs 130.25 crore from the capital markets on a net basis, and domestic institutional investors also bought shares worth Rs 502.26 crore Wednesday, provisional data showed.

Brent crude, the global benchmark, was trading higher at per 62.20 barrel up by 0.89 per cent.

Meanwhile, the benchmark BSE Sensex was trading higher by 246.08 points, or 0.65 per cent to quote at 35,822.38 while the NSE Nifty was trading at 10,705.60, higher by 53.80 points, or 0.51 per cent.