The stability was attributed to dollar sales by exporters | Image:PTI
Rupee versus Dollar: The rupee remained largely unchanged on Tuesday, exhibiting minimal movement as it traded within a narrow range throughout the session. The stability was attributed to dollar sales by exporters, which countered the weakness observed in other Asian currencies.
Closing at 83.3850 against the US dollar, the rupee’s performance barely deviated from its previous session close of 83.40. During the day’s trading, the local unit fluctuated between 83.3450 and 83.3950.
Among Asian currencies, the Malaysian ringgit experienced a decline of 0.5 per cent, leading the losses in the region. The dollar index, on the other hand, maintained stability near 105, following a rise of over 0.4 per cent on Monday, buoyed by stronger-than-expected economic data.
According to a foreign exchange trader at a foreign bank, the rupee witnessed “sideways price action” amid relatively subdued trading volumes.
In anticipation of potential rupee weakness, the Reserve Bank of India (RBI) is expected to intervene by offering dollars around the 83.45 mark, aiming to prevent the currency from reaching fresh all-time lows. Last week, the rupee had touched a record low of 83.45.
Additionally, open interest on dollar-rupee April month futures decreased after brokers informed their clients of an upcoming RBI notification. This notification, slated to take effect on April 5, is anticipated to result in a significant reduction in volumes within the segment, as reported by Reuters earlier on Tuesday.
Investors are now eagerly awaiting the release of US job openings data later in the day, along with remarks from Federal Reserve officials. These developments are expected to provide insights into policymakers’ perspectives regarding the timing of potential rate cuts.
According to CME’s FedWatch tool, the likelihood of the Fed maintaining rates unchanged in June has increased to 41 per cent, up from approximately 30 per cent just a week earlier.
(With Reuters inputs)
