On Wednesday, the domestic unit had closed at 71.04 against the greenback.

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"The indications of earlier than expected US-China trade deal strengthened investor's sentiments," said V K Sharma, Head PCG and Capital Markets Strategy, HDFC Securities. Donald Trump said a deal to end the trade war could happen sooner than people think and that the Chinese were making big agricultural purchases from the United States, including beef and pork. Mr Sharma added that rupee also appreciated amid strong equity market sentiments. The Sensex ended 396 points or 1.03 per cent higher at 38,990 and the NSE Nifty 50 index climbed 131 points or 1.15 per cent to close at 11,571. Fresh foreign fund inflows and easing crude oil prices even lent support to the domestic unit, analysts said. Foreign institutional investors (FIIs), who were net sellers for the last few sessions, bought equities worth a net Rs 737.17 crore on Thursday, according to provisional exchange data. Crude oil benchmark Brent Futures dipped 0.22 per cent to $62.25 per barrel. The dollar index, which gauges the greenback's strength against a basket of six currencies, inched up 0.06 per cent to 99.09. "ICE Dollar index has broken out from last two week's range and reached above 99," Mr Sharma said. The 10-year government bond yield was at 6.72 per cent.



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The rupee settled 16 paise higher against the dollar on Thursday. The local currency opened on a strong note at 70.99 and shuttled between a high of 70.85 and a low of 71.01 during the day. The domestic currency finally settled at 70.88 against the dollar. According to analysts, investor's sentiment got a lift after US President Donald Trump said a trade deal with China could happen sooner than expected. On Wednesday, the domestic unit had closed at 71.04 against the greenback.