Rupee up 9 paise against dollar on Federal rate hike

The rupee rose 9 paise against the US dollar to 65.12 in early trade at the interbank forex market today amid weakness in the greenback after the US Fed raised benchmark lending rate by 25 bps.

The dollar extended losses overseas after the US Federal Reserve stuck to its target for interest rate hikes this year. The central bank's Chairman Jerome Powell forecast a steeper path of rate hikes in 2019 and 2020, citing improving economic outlook.

Forex dealers said persistent inflows of foreign funds and weakness in the dollar against other currencies overseas supported the domestic unit.

Yesterday, the rupee had ended almost flat at 65.21 against the US dollar.

Meanwhile, the benchmark BSE Sensex advanced by 73.51  points, or 0.22 per cent, to 33,209.69 in opening session.

On a net basis, foreign institutional investors (FIIs) bought shares worth Rs 98.44 crore, while domestic institutional investors (DIIs) made purchases worth Rs 197.78 crore yesterday, provisional data showed.