The rupee on Thursday opened seven paise higher at 70.97 against the US dollar. The domestic unit on Wednesday dipped three paise to close at 71.04 amid rising demand for the greenback vis-a-vis other currencies overseas, even as crude oil prices eased.
Forex traders said a weak trend in domestic equities, political unrest in the US and unabated foreign fund outflows also weighed on the local unit.
“Indian rupee is flat as there are no major triggers in the market. The political unrest in the US, middle-east tensions and no update over US China trade deal has been keeping rupee under pressure. We expect USD/INR to move towards 71.50 in the next coming days. The only trigger is RBI policy, so ahead of that we expect USD/INR spot to trade in 70.70-71.50," said Rahul Gupta, Currency Research Head at Emkay Global Financial Services.
The RBI is scheduled to announce its next bi-monthly monetary policy on October 4.
Foreign investors pulled out a net Rs 342.40 crore from Indian equities on Wednesday, according to exchange data.
On the global front, Asian stocks edged up on Thursday as hopes the United States and China may soon end their year-long trade war boosted demand for riskier assets while worries about a US presidential impeachment bid ebbed. MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.1 per cent. Japan's Nikkei rose 0.45 per cent. Australian shares were up 0.13 per cent, said a Reuters report.
In commodities, oil prices were flat. Brent crude futures were at $62.34 a barrel, down 5 cents, or 0.1 per cent, while US West Texas Intermediate (WTI) crude futures were up 6 cents, or 0.1 per cent, to $56.55 a barrel, the report added.