New Delhi: The Indian rupee gained 5 paise to 95.57 against the US dollar in early trade on Wednesday, supported by softer crude oil prices and a broader recovery in Asian currencies.

At the interbank foreign exchange market, the rupee opened at 95.58 and moved up to 95.57 against the US dollar, compared with Tuesday’s close of 95.62.

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Forex traders said the direction of the currency market will largely depend on developments on the geopolitical front.

Softer crude oil prices continue to provide support to the rupee, while a firm US dollar following the US Federal Reserve’s rate hike and continued foreign portfolio outflows remain key headwinds.

“We see 96.30 as the upper cap, with strong Reserve Bank intervention expected as the pair approaches 96.30–96.50, and support at 95.50 and then 95.00,” said Anindya Banerjee, Head of Commodity and Currency Research at Kotak Securities.

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According to Banerjee, softer crude remains the rupee’s clearest support, while the firm dollar and foreign portfolio outflows remain the key offsets.

The dollar index, which measures the strength of the US dollar against a basket of six major currencies, was trading 0.10% higher at 100.70.

Brent crude, the global oil benchmark, was trading 0.99% lower at USD 98.27 a barrel in futures trade.

Domestic equity markets also opened higher on Wednesday. The Sensex gained 283.66 points to 74,812.74, while the Nifty rose 85.55 points to 23,414.55 in early trade.

Meanwhile, foreign institutional investors (FIIs) remained net sellers in the Indian equity market, offloading shares worth Rs 3,809.99 crore on Tuesday, according to exchange data.

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