The Indian rupee is expected to depreciate on Thursday amid risk aversion in global equity markets, strength in US Dollar. RBI could intervene in the spot market to control volatility, according to Forex analysts. Overall, USDINR pair is expected to trade higher in a range of 82.00 to 83.20 levels and a breakout on either side will determine further course. In the previous session, rupee depreciated against the US dollar, tracking a muted trend in domestic equities ahead of the release of the US Fed’s policy statement. At the interbank foreign exchange market, the local unit opened at 82.64 and settled at 82.78 against the American currency, registering a fall of 19 paise over its previous close of 82.59.
Anindya Banerjee, VP, Currency Derivatives & Interest Rate Derivatives at Kotak Securities
“The USDINR pair traded in a tight range, as the traders avoided speculating ahead of the FED policy outcome. The range has shrunk even further and the pair moved between 82.80 and 83.00 throughout the day.”
Anil Kumar Bhansali, Head of Treasury, Finrex Treasury Advisors
“The FED said that smaller rate hikes were on the offing and gave market half an hour of rejoicing before saying that it is not done with rate hikes. The Dow Jones plummeted by 505 points and all risk assets fell as dollar index rose to nearly 112 and US 10 year to 4.40%. The commentary was not dovish at all. Oil was higher at $95.50 per barrel while GBP and Euro were lower after the hawkish FED comments. USDINR likely to open higher at 82.90 as Asian stock markets fall and SGX Nifty was down by 30 points. Markets now await for the NFPR data on Friday which is expected to be strong keeping dollar strength continuing. Range for the day is 82.50 to 83.20. Exporters may sell dollars at 83.00 levels keeping a close watch on RBI while importers may continue to buy sll dips they get.”
Amit Pabari, MD, CR Forex Advisors
“Overnight global rout in financial markets is likely to haunt the fragile Rupee. So far its trading tad bit stronger from its all time low, helped by resumption in the FII inflows which brought about 11000 crores in merely two sessions of Nov, as the sentiments accross had improved. Well, the continuation of the same will depend on how RBI holds on to policy amid aggressive Fed. Today RBI will have its unscheduled MPC meeting, which is majorly expected to be a non-event and RBI Governor Das said a letter that will be sent to the government will not be made public after the Nov 3 special meeting because the bank does not have the authority to release it. Today we could see the RBI could intervene in the spot market to control volatility. Overall, we expect the USDINR pair to trade higher in a range of 82.00 to 83.20 levels and a breakout on either side will determine further course.”
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