Rupee advances 10 paise to 73.77 against US dollar in early trade

Mumbai: The Indian rupee appreciated 10 paise to 73.77 against the US dollar in opening trade on Thursday, tracking weakness of the American currency in the overseas market and a firm trend in domestic equities. At the interbank foreign exchange, the rupee opened at 73.85 against the dollar, then edged higher to 73.77, up 10 paise over its previous close.

On Wednesday, the rupee had settled at 73.87 against the US dollar.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.10 per cent to 93.36.

Forex traders said a slightly hawkish tilt from the US Federal Reserve supported the dollar, said Sriram Iyer, Senior Research Analyst at Reliance Securities.

The US Federal Reserve said it will likely begin reducing its monthly bond purchases as soon as November and signalled interest rate increases may follow more quickly than expected.

Iyer further noted that risk appetite could improve in the region as concerns surrounding the China Evergrande default eased after its chairman said that the company will make it a top priority to help wealth investors redeem their products.

Meanwhile, foreign institutional investors were net sellers in the capital market on Wednesday as they offloaded shares worth Rs 1,943.26 crore, as per exchange data.

On the domestic equity market front, BSE Sensex was trading 567.05 points or 0.96 per cent higher at 59,494.38, while the broader NSE Nifty advanced 170.70 points or 0.97 per cent to 17,717.35.

Global oil benchmark Brent crude futures rose 0.26 per cent to USD 76.39 per barrel.