INR recovers from record low levels; Weak dollar and foreign fund inflows aid

The Indian rupee recovered slightly from its record low level and ended with a gain of 4 paise at 88.11 (provisional) against the US dollar on Wednesday aided by strong foreign fund inflows and a weaker greenback. The dollar index is lingering around a 7-week low on Wednesday with all eyes on US inflation reports due this week for further cues on Federal rate decision. Hopes of a breakthrough in India-US trade talks and positive sentiments in domestic equity markets supported the local unit while rise in crude oil prices capped gains. At the interbank foreign exchange, the rupee opened at 88.14 against the US dollar and traded in a narrow range of 88.06-88.19 before settling at 88.11 (provisional), up 4 paise from its previous close. Meanwhile, Indian stocks closed on a positive note on Wednesday, extending previous session's gains, amid expectations of further reduction in GST rates, and hopes of a larger than expected interest rate cut by the Federal Reserve. The BSE benchmark Sensex, which climbed to 81,643.88 early on in the session, closed with a gain of 323.83 points or 0.4% at 81,425.15. The National Stock Exchange's Nifty50, which advanced to 25,035.70, settled at 24,973.10, gaining 104.50 points or 0.42%. On the NSE, USDINR futures inched lower to settle at 88.18.

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