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Indian Rupee snaps two-day winning streak; opens 8 paise lower at 85.48/$
The Indian Rupee opened weaker on Tuesday, snapping two days of gains, amid a lack of major triggers for the currency.
The domestic currency opened 8 paise lower at 85.48 after closing at 85.40 against the greenback on Monday, according to Bloomberg data. So far this calendar year, the currency has depreciated by 0.3 per cent.
The local unit is expected to open a tad weaker at 85.44 and will remain in a range of 85.25/75 for the day as there is no fresh market indicator for it to change course, according to Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP. "With US yields falling, there could be some buying in the dollar to take the pair higher."
The Dollar index continues to weaken amid pressures from a ratings downgrade for the US debt by Moody's Ratings. The Index, which measures the greenback against a basket of six major currencies, was trading 0.06 per cent lower at 100.36. The dollar Index faces immediate resistance around the 101.20–101.40 zone, with support at 100.00, according to Amit Pabari, managing director at CR Forex Advisors.
Moody's downgraded the US rating from a top-tier rating of AAA to AA1, citing concerns over the ballooning debt that could worsen under President Donald Trump's tax cuts.
A strong foreign institutional investor (FII) inflow, totalling nearly $1.4 billion over the last two trading sessions, further supported the rupee, Pabari said. "Additionally, upcoming initial public offerings are likely to attract more FII inflows, further strengthening the currency."
The rupee is expected to trade in a stable range of 85.00–85.80 in the near term, Pabari noted. "As the dollar continues to slide due to deepening fiscal concerns in the US, the rupee may witness further appreciation."
Meanwhile, after a phone call with Vladimir Putin, US President Donald Trump said that Russia and Ukraine will 'immediately' begin negotiations to end the war. Following this, Brent crude price was down 0.08 per cent to $65.49 per barrel, while WTI crude prices were flat at 62.69, as of 9:12 AM.
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