The rupee fluctuated within a narrow range against the US dollar in early trade on Thursday, gaining 1 paise to 82.62 due to the positive trend in the domestic stock market.
Foreign fund outflows and relatively high crude prices weighed on domestic units, currency traders said.
Investors also awaited GDP data for the first quarter of the fiscal year due later in the day.
In the interbank foreign exchange market, domestic units opened at 82.65 against the U.S. dollar, with a trading range ranging from a maximum of 82.58 to a minimum of 82.73.
Subsequently, the rupee traded at 82.62 against the dollar, up 1 paise from the previous close.
On Wednesday, the rupee closed at 82.63 against the dollar.
U.S. employment data falls short of expectations
The latest U.S. data showed that job growth was slower than expected in August, raising hopes of a rate cut by the Federal Reserve.
Gaurang Somaiya, currency and gold analyst at Motilal Oswal Financial Services, said the dollar extended losses “due to disappointing preliminary U.S. GDP data.”
“Domesticly, GDP figures are due today; Q1 growth is expected to have accelerated by 7.7% driven by higher services and capital spending.
“If the numbers beat expectations, we could see rupee strengthening against the dollar. We expect USD/INR (spot) to move sideways with quotes ranging from 82.40 to 82.80,” Somaiya added.
The dollar index , which measures the greenback’s strength against a basket of six currencies, fell 0.03% to 103.14.
Brent crude futures, the global oil benchmark, fell 0.03% to $85.83 a barrel.
On the domestic market, the 30-share BSE Sensex rose 113.86 points, or 0.17 percent, to 65,201.11. The NSE Nifty edged up 18 points, or 0.09%, to 19,365.45.
Foreign institutional investors (FIIs) were net sellers in the capital market on Wednesday, selling shares worth Rs 4,946.8 crore, according to exchange data.
