₹ logs best day in over 5 years, vaults 112 paise on crude slide

Mumbai: The Indian rupee Tuesday rallied by a whopping 112 paise, its best single-day gains in over five years, to settle at 70.44 against the US dollar as softening crude oil prices eased concerns over India's current account deficit expansion.

Besides, sustained selling of the American currency by exporters and banks as well as the greenback's weakness against its key rivals globally ahead of the US Fed policy decision Wednesday also helped the domestic unit scale further heights.

The Brent crude, an international benchmark, was trading 2.26 per cent lower at $58.26 per barrel, a 14-month low.

At the Interbank Foreign Exchange (forex) market, the rupee opened on a firm note at 71.34 from. It gained further ground to hit a high of 70.44, a massive climb of 112 paise over its previous closing.

The Indian currency had gained 34 paise to close at 71.56 against the US dollar Monday.

The Tuesday's 112 paise ascent marked the best day for the rupee since September 19, 2013, when it had surged by 161 paise against the US dollar.

Forex dealers said a drop in bond yields easing liquidity concerns in the market and bullish trend in equities trading also supported the rupee in maintaining its upward movement. The benchmark Sensex wiped off early losses to end 77 points higher at 36,347 Tuesday, the sixth consecutive session of gains, after fag-end buying mainly in pharma, metal and capital goods stocks offset losses in information technology and FMCG counters amid weak global cues.

Also, the broader NSE Nifty ended above the 10,900-mark.

The BSE Sensex swung almost 329 points both sides on hectic selling and buying during the session. The 30-share index started off the day lower at 36,226.38 and continued to slide as selling pressure gathered momentum and hit a low of 36,046.52 in line with a weak trend in Asian markets and lower opening of European shares.

However, hectic buying in late afternoon trade reversed the day's losses and helped the Sensex scale 36,375.38 before settling 77.01 points, or 0.21 per cent, higher at 36,347.08.

The gauge had risen over 1,310 points in the last five sessions.

The 50-share NSE Nifty too rose by 20.35 points, or 0.19 per cent, to end at 10,908.70. Intra-day, it traded between 10,819.10 and 10,915.40.

Traders said falling crude prices in the global market was a big boost for the economy as it cuts the country's import bill burden.