MUMBAI — The Indian rupee rose against the U.S. currency on Thursday on the back of the dollar’s decline against its major peers and Asian currencies.
The rupee was at 82.72 per U.S. dollar by 10:35 IST, up from 82.81 in the previous session. The local unit had opened at 82.80.
The pair (USD/INR) has been “unexpectedly” well offered, partly due to lack of triggers that could take it near the 83 level, a spot trader at a bank said. The pair remains “hopelessly rangebound,” the trader added.
“USD/INR remains calm going into the holiday week of Christmas,” said Jateen Trivedi, research analyst at LKP Securities. The near-term range for USD/INR is 82.50-82.95, with bias towards a weaker rupee, Trivedi added.
Asian currencies were trading higher, while the dollar index declined to 103.92 on positive risk sentiment. The overnight rally on U.S. equities spread to Asia. U.S. consumer confidence rose to an eight-month high in December, lifting appetite for risk assets.
Meanwhile, traders will scrutinize data due later in the day from the United States to assess the growth and interest rate outlook for the world’s largest economy, heading into the new year.
Indian equities opened higher, but were unable to sustain the advance amid concerns over inflation.
The Reserve Bank of India’s latest monetary policy meeting minutes showed the central bank was concerned about inflation and most policymakers reckoned that a premature pause to its rate tightening cycle is not warranted. The rupee forward premiums rose, resuming their upward march. The 1-year implied yield was up 3 basis points at 2.10%. Forward premiums have been moving up following the RBI policy decision on Dec. 7, and analysts expect a further rise. (Reporting by Nimesh Vora; Editing by Dhanya Ann Thoppil)