INR hovers around three week high; Dollar rebound could weigh

The Indian rupee is likely to stay cautiously lower in opening trades on Thursday tracking dollar strength overseas. Rupee pared initial losses and settled on a higher note at 87.07 against the US dollar on Wednesday, up by 6 paise on the back of a rise in risk appetite in global markets. INR is hovering around a three-week high amid easing tensions over trade tariffs and hopes of peace between Russia and Ukraine. Moreover, the proposed GST reforms and a recent credit rating upgrade by a foreign agency have bolstered confidence in the Indian economy. Meanwhile, benchmark indexes Sensex and Nifty rose around 0.3 percent each on Wednesday to extend gains for a fifth day running, with underlying sentiment supported by the unexpected announcements relating to GST reforms and the recent progress in India-China ties. Foreign investors offloaded shares worth Rs 1,100 crore on a net basis Wednesday, while domestic institutional investors sustained their support with net purchases of Rs 1,806 crore, as per provisional exchange data.

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