Rupee settles almost flat; falls 1 paisa to close at 79.86 against US dollar

The rupee settled on a flat note on Friday as gains from positive domestic equities and fresh foreign inflows were negated by strong demand for the American currency in the overseas market.

The rupee settled on a flat note on Friday as gains from positive domestic equities and fresh foreign inflows were negated by strong demand for the American currency in the overseas market.At the interbank forex market, the local unit opened lower at 79.90 against the greenback and finally settled at 79.86, registering a fall of just 1 paisa from its previous close.During the day the local unit witnessed an intra-day high of 79.86 and a low of 79.92 against the American currency.On Thursday, the rupee recovered from its all-time low of 80.06 to close 20 paise higher at 79.85 against the US dollar following overall weakness in crude oil prices and fresh foreign fund inflows.The dollar index, which measures the greenback's strength against a basket of six currencies, was up 0.20 per cent at 107.12.Brent crude futures, the global oil benchmark, fell 0.56 per cent to USD 103.28 per barrel."Surge in domestic markets, FII inflows and softening crude oil prices supported the Rupee. However, a positive Dollar capped sharp gains," Anuj Choudhary - Research Analyst at Sharekhan by BNP Paribas.Dollar gained Friday on improved safe-haven appeal amid concerns over the recession and disappointing PMI data from Europe."We expect the Rupee to trade on a mixed to negative note on a strong Dollar and concerns over inflation and rising twin deficits. The dollar is also expected to recover from lower levels ahead of the Federal Open Market Committee (FOMC) meeting next week wherein, the Fed is expected to hike rates aggressively," Choudhary said.On the domestic equity market front, the BSE Sensex ended 390.28 points or 0.70 per cent higher at 56,072.23, while the broader NSE Nifty advanced 114.20 points or 0.69 per cent to 16,719.45.Foreign institutional investors remained net buyers in the capital market on Thursday as they purchased shares worth Rs 1,799.32 crore, as per exchange data.