Fri Mar 21 05:02:36 UTC 2025: ## Rupee Strengthens Against Dollar on Positive Market Sentiment

**Mumbai, March 21, 2025** – The Indian rupee appreciated by 17 paise against the US dollar in early trade on Friday, reaching 86.19. This positive movement is attributed to a surge in domestic equities and significant foreign fund inflows.

Forex traders cite a shift in foreign portfolio investor (FPI) activity as a key factor. FPIs have shown net buying for the second consecutive day this week, investing heavily in both equity and debt markets. This follows weeks of outflows. On Thursday alone, FPIs invested ₹3,239.14 crore in equities, according to exchange data. A further ₹5,500 crore was injected into debt markets, driven by India’s higher real yield of 3.028%, according to Amit Pabari, MD of CR Forex Advisors.

The rupee opened at 86.26 against the dollar before strengthening to its intraday high. On Thursday, the rupee closed at 86.36, a 1 paisa gain. While acknowledging the recent volatility linked to the US Fed meeting, Pabari highlighted the positive influence of strong FII inflows.

Despite global headwinds and a slight increase in the US dollar index (up 0.13% to 103.98) and Brent crude (up 0.44% to $72.32 per barrel), Pabari predicts the USD-INR pair will trade between 86.00 and 86.80 in the short term, with a possible rebound towards 86.50-86.60.

Domestically, the positive sentiment extended to the equity market, with the BSE Sensex up 0.21% at 76,506.85 points and the Nifty up 0.32% at 23,265.05 points.

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