Rupee strengthens 35 paise to 95.64 against US dollar in early trade

The rupee extended its gains for a third straight session on Tuesday, appreciating 35 paise to 95.64 against the US dollar in early trade, supported by easing crude oil prices, a softer US dollar and positive sentiment in domestic equity markets.

The Indian currency opened at 95.75 in the interbank foreign exchange market before strengthening further to 95.64 against the greenback. The rally follows Monday's sharp 54-paise gain, after the rupee had also advanced 20 paise in the previous trading session.

Foreign exchange traders attributed the rupee's continued recovery to declining global oil prices, a weaker dollar index and improved investor sentiment in Indian equities.

The US dollar index, which measures the greenback against a basket of six major currencies, was trading 0.06 per cent lower at 101.31.

Global crude prices also remained under pressure, with Brent crude futures falling 1.43 per cent to USD 87.10 a barrel.

Analysts said oil prices eased as tensions in West Asia appeared to moderate, with the United States and Iran refraining from attacking each other's targets for a third consecutive day. Market sentiment was also supported by reports that diplomatic efforts had made progress towards bringing both sides back to negotiations.

US President Donald Trump said Iran had sought further discussions, claiming it had reached out directly after sustained US strikes. Tehran, however, denied that any direct talks were currently taking place.

Domestic equity markets also traded in positive territory during early deals. The BSE Sensex gained 14.66 points, or 0.02 per cent, to 76,850.44, while the NSE Nifty rose 27.10 points, or 0.11 per cent, to 24,023.45.

Despite the rupee's strength, foreign institutional investors (FIIs) remained net sellers, offloading equities worth Rs 1,688.23 crore on Monday, according to exchange data.

With PTI inputs