Dollar index moving higher provided support to the USDINR pair but we feel upsides could be limited in the pair, said ICICIdirect.
Indian rupee is trading flat at 72.73 per dollar, amid selling seen in the domestic equity market.
It opened flat at 72.76 per dollar against Wednesday’s close of 72.75.
At 12:39 IST, the Sensex was down 365.47 points or 0.71% at 51,338.36, and the Nifty was down 91.40 points or 0.60% at 15,117.50.
“Today’s Fed minutes will decide whether USDINR spot will appreciate or not because Powell was dovish in his recent speech, if the same is reflected by all the FOMC members then we may see bearishness to continue in USDINR spot. Also, it depends on how US yields react to the fiscal stimulus package as it will increase inflationary pressure,” said Rahul Gupta, Head Of Research-Currency, Emkay Global Financial Services.
“Currently, the spot is trading in between 72.50-73 and we expect the range to stay intact in near-term. Only a consistent trading above 73 will push the spot towards 73.25-73.30,” he added.
Oil prices rose as much as a dollar on Thursday, extending this week’s gains and hitting 13-month highs, as a cold snap sweeping Texas and surrounding regions shut at least a fifth of U.S. refining output and a million barrels of crude production.
The USDINR future partly continued its momentum and gained for a second day. Dollar index moving higher provided support to the pair but we feel upsides could be limited in the pair, said ICICIdirect.
The dollar-rupee February contract on the NSE was at Rs 72.80 in the last session. The open interest declined almost 7% in the February series, it added.