After a flat closing last week, the Indian rupee slipped 13 paise to a low of 68.79 against the US dollar in early trade on Monday ahead of RBI’s monetary policy review beginning today. Fresh month-end demand of the US currency from importers, along with the dollar’s strength against some currencies overseas put pressure on the rupee’s movement, said a PTI report. Global investors are also watching out for the US Federal Reserve meeting later this week.
The rupee closed almost flat at 68.66 against the US currency on Friday after a volatile trading session. Meanwhile, in the domestic equity markets, the benchmark indices scaled record highs in early trade on Monday, with the BSE Sensex surging to a fresh record high of 37,496.80 points and the NSE Nifty of 11,309.35 points.
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“Last week, the Indian rupee managed to close strongly thanks to weakness in USD. US Dollar Index (DIX) fell to two week low at 94 as US-European Union (EU) pledge to cut tariff barriers,” Bhavik Patel, Senior Technical Analyst, Tradebulls Securities, told FE Online. “Robust GDP data from the US helped DXY in trimming its gains and we saw emerging market currencies getting strong against USD including Indian rupee.”
“Rupee continues to consolidate in tight trading range and focus now will shift to RBI policy this week,” said Patel. According to Patel, the rupee is expected to trade in the range of 68.80-69.15 today.
“In the domestic space, FIIs were buyers in the cash market and debt segment to the tune of Rs 738.05 crore and Rs 406.12 crore respectively. For local currency, 69.11 still remains the major level while on the other side 68.05 is the level to focus above which rupee is likely to hit 67.40,” Geojit Financial Services said in a report.