Finance
The Indian rupee fell slightly on Friday, reflecting the rise in the dollar index, but forward premiums remained unchanged. The rupee was trading at 82.0275 to the US dollar at 10:52 a.m. IST, up from 81.9850 on Thursday. So far, the local currency has been in the 3-paisa area.
“Another day, another standoff around 82. Hopefully, next week will bring in a tradeable move,” a forex dealer at a bank said. The Federal Reserve‘s policy decision is due next Wednesday, followed by that of the European Central Bank (ECB) on Thursday and the Bank of Japan (BOJ) on Friday.
The Fed and ECB are projected to hike rates by 25 basis points, but the BOJ’s yield curve management policy is predicted to remain unchanged. There is also a flurry of major data releases from the United States, including the flash purchasing manager’s index, June quarter GDP, first unemployment claims, and core personal consumption expenditures index.
Asian currencies fell after the dollar index and US rates jumped on data showing that the US labor market remained strong. Initial claims for jobless benefits have fallen to their lowest level since mid-May. In Asia, the dollar index rose to 101.78, while the 2-year US yield surpassed 4.80%.
While the dollar index is “showing renewed strength,” Amit Pabari, managing director at CR Forex, believes the pressure will remain on the negative until the resistance level of 101.80 is decisively broken. Rupee premiums, like spot rates, were limited. The 1-year implied yield remained unchanged at just around 1.70%.
Source:FE
