The rupee rose 58 paise to close at 74.35 against the US dollar.

On Friday, the rupee strengthened by 5 pa pa to close at 4.35 (provisional) against the US dollar, supported by positive domestic equities, which improved risk appetite.

In the interbank foreign exchange market, the local unit opened against the greenback at 74.76 and saw an intra-day high of 74.28 and a low of 74.76.

It finally closed at 74.35 against the US currency, registering an increase of 58 paise over the previous close. The rupee had closed at 74.93 against the US currency on Thursday.

“The Indian rupee strengthened amid weakness in the dollar and increased risk appetite in domestic markets,” said Sharekhan, a research analyst, stock analyst by BNP Paribas.

Mukadam further said that the dollar sank due to the decline in the yield of the US treasury. “US Treasury yields declined as policymakers of the US Federal Reserve indicated that the central bank was not in a hurry to reduce its support,” he said.

The dollar index, which estimates the strength of the greenback against a basket of six currencies, fell 0.09% to 91.59.

According to Mukadam, further gains for the local unit were stalled on the rise in crude oil prices, and concerns that increasing cases of COVID-19 in India and the lockout ban in some states could hurt the economic recovery.

Meanwhile, global oil benchmark Brent crude futures rose 0.40% to $ 67.21 a barrel.

On the domestic equity market front, the BSE Sensex rose 28.35 points or 0.06% to close at 48,832.03, while the broader NSE Nifty rose 36.40 points or 0.25% to 14,617.85 points.

Foreign institutional investors were net buyers in the capital market as they bought shares worth net 979.70 crore as per exchange data on Thursday.