The Indian rupee appreciated by 18 paise against the U.S. dollar at the opening on Friday, supported by broad-based weakness in the U.S. currency following weaker-than-expected U.S. employment data. The domestic currency opened at 95.21 against the U.S. dollar, compared with its previous close of 95.39.

The recovery comes after the rupee weakened over the previous three trading sessions. A softer dollar improved sentiment across emerging market currencies, helping the Indian unit begin the day on a firmer note.

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Dollar Weakness Supports Domestic Currency

According to Firex, the decline in the dollar index below the 101 mark could provide additional support to the rupee during the session. The firm expects the currency pair to trade in the 94.80-95.50 range, with the rupee likely to test the 95.00 level if demand for the U.S. dollar remains contained.

Firex also noted that exporters who had delayed selling their dollar holdings may begin covering positions for July, while importers could utilise any easing in the exchange rate to meet their dollar requirements.

Asian Currencies Trade Mixed

Regional currencies delivered a mixed performance against the U.S. dollar on Friday.

The Malaysian ringgit led gains with an appreciation of 0.270%, followed by the Philippine peso, which advanced 0.202%, and the Thai baht, up 0.178%. The Chinese renminbi, Singapore dollar and Taiwan dollar also posted modest gains during early trade.

Among the weaker currencies, the South Korean won declined 0.383%, marking the sharpest fall in the region. The Indonesian rupiah slipped 0.239%, while the Japanese yen edged 0.074% lower against the U.S. dollar.

U.S. Data Keeps Dollar Under Pressure

The U.S. dollar remained under pressure after softer U.S. labour market data reduced expectations of near-term monetary tightening by the Federal Reserve. The weaker outlook for the dollar index supported several major and emerging market currencies.

The softer greenback also provided support to gold price in international markets, while easing pressure on currencies that had recently faced depreciation against the U.S. dollar.

Market participants will continue monitoring upcoming U.S. economic data and global currency movements for fresh cues. For the domestic market, the rupee’s direction is expected to remain linked to dollar demand, overseas capital flows and broader global sentiment through the trading session.