The Indian rupee strengthened for the fourth straight trading session on Monday. The domestic currency opened 5 paise higher at 71.67/dollar as against its previous close of 71.72 a dollar. In the afternoon session, the rupee hit an intraday high of 71.50 against the US dollar.
Improved risk sentiment in the global markets and gains in the Indian benchmark stock indices kept the rupee stronger. The rupee and the Indian markets usually move in the same direction.
NSE's Nifty 50 ended 0.52 percent higher at 11,003.05 on Monday. It is the first time since 30 August that the index has closed above the 11,000-mark. It was also its fourth consecutive trading session of gains, the longest winning streak since 4 July.
BSE's Sensex closed 0.44 percent higher at 37,145.45.
The attention of forex traders now rests on ECB's (European Central Bank) rate decision and USA's CPI (consumer price inflation) data, both of which are due on 12 September. India's CPI and IIP (Index of Industrial Production) data are also due on the same day. In the coming week, market watchers await US Federal Reserve's rate decision.
Global risk sentiment improved after the US and China said they would resume trade talks in the coming month. Federal Reserve Chair Jerome Powell's optimistic remarks last week, also helped.
Powell said that the weaker-than-expected US non-farm payroll report was consistent with a quite strong labour market at a panel session in Zurich. He further said that despite all the trade uncertainties, he does not foresee or expects a recession in the US and the Fed will do what is appropriate for economic expansion.
China's central bank, on Friday, said that it was reducing how much cash banks must hold in reserve, releasing liquidity to push the economy that was slowed down by trade conflicts.