The rupee appreciated 20 paise to 75.71 against the U.S. dollar in early trade on May 19 as initial success in COVID-19 vaccine trial boosted investor sentiment world over.
Forex traders said besides the encouraging results in COVID-19 vaccine trial, higher opening of domestic equities and weakening American currency supported the local unit.
At the interbank foreign exchange, the rupee opened at 75.71, registering a rise of 20 paise over its previous close.
On May 18, the rupee had settled at 75.91 against the U.S. dollar.
The rupee opened with gains this Tuesday amid improving risk appetite after encouraging data from the trial of a vaccine for COVID-19. Initial data from Moderna Inc’s COVID-19 vaccine showed that it produced protective antibodies in a small group of healthy volunteers,” Reliance Securities said in a research note.
Moreover, optimism about resumption in economic activity could aid sentiments after shops and restaurants re-opened in Italy, while other centres of the outbreak such Spain and Portugal will gradually lift restrictions, it added.
The Indian government on May 17 extended the coronavirus lockdown for two more weeks with the fourth phase providing more relaxations outside containment zones.
Domestic bourses were trading on a positive note on May 19 with the benchmark Sensex surging 571.51 points to 30,600.49 and broader Nifty rising 165.60 points to 8,988.85.
Foreign institutional investors were net sellers in the capital market, as they offloaded equity shares worth ₹2,512.82 crore on May 18, according to provisional exchange data.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.02% down at 99.64.
Meanwhile, Brent crude futures, the global oil benchmark, rose 0.34% to $34.93 per barrel.
