On Wednesday, the Indian rupee appreciated thanks to a decline in the yield on US bonds, which also helped boost most Asian currencies.
By 09:45 a.m. IST, the rupee’s value versus the US dollar was 82.9825 (Dh22.6), hardly moving from its previous closing of 83.0550.
The dollar index dropped by almost 0.3% on Tuesday but was stable at 104.1 today. Tuesday saw a decline in the yield on the 10-year U.S. Treasury of 8 basis points (bps) to 4.08% as investors watched for signs of when the Federal Reserve could start lowering policy rates.
Although the dollar-rupee exchange rate may be “slightly under pressure” during the day, a foreign exchange dealer at a private bank said that the potential downside would be limited by importers’ dip-buying demand, which includes local oil corporations.
Most of the rupee’s Asian counterparts saw slight increases, with the Philippine peso and Indonesian rupiah topping advances at roughly 0.2% apiece.
Anil Kumar Bhansali, head of treasury at Finrex Treasury Advisors, stated that the rupee has been “moving in small ranges” for the past two sessions and that this trend will probably continue on Wednesday.
According to a Reuters survey, economists anticipate that if the Reserve Bank of India intervenes in the currency markets, the rupee will weaken marginally, reaching 83 in one month and 82.84 in three.
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