Indian rupee erased intraday gains ended flat at 74.93 per dollar, amid buying seen in the domestic equity market after Reserve Bank of India has kept the repo rate unchanged at 4 percent.
It opened higher by 11 paise at 74.82 per dollar against previous close of 74.93 and trade in the range of 74.77-74.96.
At 14:08 IST, the Sensex was up 407.45 points or 1.08% at 38070.78, and the Nifty was up 111.80 points or 1.01% at 11213.50.
"The weakness in dollar is weighing on USDINR spot pair. The USDINR spot is trading in an indecisive market, RBI policy is the major trigger this week. We expect a repo rate cut of 25bps, an absence of rate cut may weigh on rupee, " said Rahul Gupta, Head of Research- Currency, Emkay Global Financial Services.
"The 74.75 is acting as an immediate support. A break of 74.75 will push spot towards 74.50 while 75.50 will act as a crucial resistance," he added.
The dollar struggled to stem its broad decline on Thursday as investors worried the U.S. economic recovery may lag other countries due to a high level of coronavirus infections while the global economy slowly gets back on its feet.
Gold pushed further past $2,000 an ounce on Wednesday in the face of a weak dollar and expectations of more stimulus measures for the pandemic-ravaged global economy, while stocks in Europe and on Wall Street rallied on encouraging corporate earnings.
Oil prices were unchanged on Thursday, struggling to hold onto five-month highs reached in the previous session, as fuel demand worries caused by a second wave of coronavirus infections outweighed declines in the U.S. dollar.
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