Rupee up 6 paise at 75.53 against the US dollar

The rupee on Tuesday opened 6 paise higher at 75.53 against the US dollar after the RBI increased the limit for FPIs investment in corporate bonds to 15 per cent of outstanding stock for FY 2020-21.

The existing investment limit for FPI investment in corporate bonds stands at Rs 3.17 lakh crore, while the revised limit shall be Rs 4,29,244 crore for the first half of FY21 (April 2020-September 2020) and Rs 5,41,488 crore for the second half of the next financial year.

The local currency on Monday tumbled 70 paise to close at 75.59 against the US dollar as concerns around coronavirus impact on the economy continued to hurt sentiment globally. On the domestic front, continued selling by FIIs in the equity and debt segment is likely to cap the upside of Indian currency.

“Market participants will also be keeping an eye on the increased number of coronavirus cases reported in India and the same is likely to influence the move for the rupee. We expect the rupee (Spot) to quote in the range of 75.20 and 76.20,” brokerage firm Motilal Oswal Financial Services said in a report.

Dollar rose against its major crosses and snapped a week’s decline as investors braced for prolonged uncertainty and government’s tightened lockdowns and launched monetary and fiscal measures to fight the coronavirus pandemic. The number of coronavirus cases reported in US stand at over 1,60,000 and the total deaths reported are over 3,100.

From the US, market participants will also be keeping an eye on employment numbers that will be released later this week. Weaker-than-expected employment number could cap gains for the greenback.