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Rupee like to appreciate on weak dollar; USDINR pair to trade with positive bias in this range

The Indian Rupee expected to appreciate on Friday amid weak dollar. However, investors will remain vigilant ahead of Fed chair Powell Speech and industrial production data.

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The dollar is expected to remain in demand following the flight to safety in a rising interest rate scenario

The Indian Rupee expected to appreciate on Friday amid weak dollar. However, investors will remain vigilant ahead of Fed chair Powell Speech and industrial production data, according to ICICIDirect. “We feel rupee is likely to appreciate towards its support level of 78,” the brokerage said. In the previous session, the rupee recovered from its record low to close higher against the American currency, tracking the overnight weakness of the dollar and falling crude oil prices. At the interbank forex market, the local unit opened at 78.06 against the greenback and moved in a narrow range before it finally ended at 78.10, higher by 12 paise over its previous close.

Dilip Parmar, Research Analyst, HDFC Securities

“Indian rupee heads for muted opening in line with the Asian peers. The rupee remained resilient so far this week in expectation of recovery and the central bank’s intervention. However, the momentum remains bearish following foreign fund outflows, risk-averse sentiments, higher crude oil prices and weaker progress of the monsoon. On Thursday, spot USDINR closed at 78.075 almost unchanged from the previous close. One may see some profit booking in the near term but the odds of 78.50 are very much on the card. The dollar is expected to remain in demand following the flight to safety in a rising interest rate scenario.”

Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services

Rupee traded in a narrow range and volatility remained low despite sharp sell-off in domestic and global equities. Pound witnessed high volatility after the Bank of England raised interest rates by 25 basis points, confounding forecasts by some market participants of a bigger hike to fight soaring inflation. The BoE also downgraded its short-term forecasts for Britain’s economy, saying it would shrink by 0.3% in the April-June period. Today, focus will be on the Fed Chairman’s speech and industrial production number from the US. We expect the USDINR(Spot) to trade with a positive bias and quote in the range of 77.70 and 78.40.”

Anil Kumar Bhansali, Head of Treasury, Finrex Treasury Advisors

“Rupee to open around 78.05 after BOJ kept its policy stable in the morning while yesterday BOE hiked rates by 25 bps with a clamour to hike rates faster. SNB also hiked rates by 50 bps although it was not expected to cause an equity sell-off. USDINR remains in the same range of 77.90 to 78. 25 with upticks getting sold off while downticks getting bot. Eur and GBP moved higher against the dollar after hike in rates by BOE. Today is a quiet day. Sell the upticks on the dollar-rupee towards 68.25 and buy the dips towards 77.90 with importers needing to hedge near term. Exporters may sit tight with a stop loss of 77.85 unless they get near 78.25.”

(The recommendations in this story are by the respective research analysts and brokerage firms. FinancialExpress.com does not bear any responsibility for their investment advice. Capital markets investments are subject to rules and regulations. Please consult your investment advisor before investing.)

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