Rupee Opens Stronger Against US Dollar

The rupee opened stronger against the greenback as the dollar index gave up gains in Asia session. The Indian unit opened 8 paise stronger against US Dollar at 87.13.

The rupee is likely to trade in the 87.10-87.40 range with sideways price action, said Abhishek Goenka, founder and CEO, India Forex and Asset Management Pvt. Ltd. (IFA Global).

It had settled flat at 87.21 a dollar on Wednesday.

The dollar index, which measures the strength of the US unit against six major currencies across the globe, rose Wednesday on concerns that President Donald Trump's tariff policies will increase inflation in the country very soon. This concern weighed on investors' minds despite data showing that inflation eased in February.

US CPI rose 2.8% on the year in February, compared to 3.0% rise in January. The February increase is less than 2.9% projected by analysts in Reuters' poll.

The dollar index was trading 0.06% down at 103.55 as of 9:05 a.m. It ended 0.19% higher at 103.61 on Wednesday.

Cooling US inflation is expected to boost dovish bets for Federal Reserve's policy. Eyes are on US PPI data. For USDINR, 86.90 acts as resistance while 87.40 as a support, said Kunal Sodhani, vice president, Global Trading Centre, Shinhan Bank.

Oil prices reversed gains in Asia session after delivering biggest gains in two weeks on Wednesday, according to Bloomberg. This is expected to provide further relief to the Indian unit.

Crude oil May future contract jumped 2.21% to $71.10 a barrel, touching the highest level since March 7. It was trading 0.10% down at $70.98 a barrel as of 8:58 a.m.