MUMBAI, March 24 (Reuters) - The Indian rupee was likely to open little changed against the greenback on Friday as the dollar index recovered some gro
MUMBAI, March 24 (Reuters) – The Indian rupee was likely
to open little changed against the greenback on Friday as the
dollar index recovered some ground to weigh on Asian currencies.
The non-deliverable forwards indicate that the rupee
will open at around 82.25-82.30 to the U.S. dollar,
compared with 82.2625 in the previous session.
The rupee notched its best trading session in three weeks on
Thursday as Asian currencies broadly rose on hopes that the
Federal Reserve was nearing the end of its rate hiking cycle.
Some of those moves seemed to be reversing on Friday, as the
Chinese yuan dipped to 6.84 per dollar while the South Korean
won fell 0.3% as the dollar index eked out marginal gains
after declining for six straight sessions.
Central banks in Switzerland, Norway and Britain all raised
interest rates overnight, while more U.S. data indicated the
labour market remained tight, showing no impact yet of the
failure of two regional banks that had roiled financial markets.
It seems to be a conflicting day for the rupee as falling
U.S. yields could weigh on the dollar further, but risk
sentiment doesn’t seem to be fully back yet, said a trader with
a Mumbai-based bank.
“Dollar bulls need validation from the (dollar index’s)
50-day moving average hurdle of 103.45 to extend the rebound.
For USD/INR, 82.00 acts as a support while 82.55-82.60 a
resistance,” said Kunal Sodhani, vice-president of Shinhan Bank
(Global Trading Centre).
Asian equities were mostly lower, while U.S. equity futures
reversed course to slip.
Meanwhile, U.S. bond yields continued to decline further on
dovish Fed expectations. The benchmark 10-year note yields
fell 10 basis points (bps) to 3.40% overnight and
two-year yields dropped 18 bps to 3.806%.
Money markets show a near-60% probability of a pause at the
Fed’s May meeting and about 90 bps worth of rate cuts this year.
KEY INDICATORS:
** One-month non-deliverable rupee forward at
82.46; onshore one-month forward premium at 19.25 paisa
** USD/INR NSE March futures settled on Thursday at 82.2475
** USD/INR March forward premium is 1.25 paisa
** Dollar index up at 102.62
** Brent crude futures down 0.4% at $75.6 per barrel
** Ten-year U.S. note yield at 3.4%
** SGX Nifty nearest-month futures down 0.1% at
17,062
** As per NSDL data, foreign investors sold a net $126.3 mln
worth of Indian shares on Mar. 21
** NSDL data shows foreign investors bought a net $229.2 mln
worth of Indian bonds on Mar. 21
(Reporting by Anushka Trivedi; Editing by Savio D’Souza)
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