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19 Nov 2024
The Indian rupee is anticipated to experience slight relief on Thursday following the dollar index's decline to a near four-month low, largely driven by the yen's rally.
Non-deliverable forwards suggest the rupee will open between 83.5750 and 83.5850 against the U.S. dollar, compared to 83.5825 in the previous session.
Despite initial gains from strong U.S. retail sales data, the dollar index retreated on Wednesday to its lowest level since mid-March. The yen's surge, potentially due to Bank of Japan intervention, pushed the dollar index below 104.
While the onshore Chinese yuan edged up, other Asian currencies remained stable. A currency trader noted that the rupee is likely to see relief, avoiding a new low of 83.6650.
However, the rupee is under pressure due to significant dollar payments across various sectors, making buying opportunities on dips in the dollar/rupee pair, according to the trader.
Support for the rupee is seen near the 83.60 mark, with expectations that the central bank will prevent further depreciation.
The dollar's performance against major currencies is influenced by growing expectations of rate cuts by the Federal Reserve in the coming months. Fed officials Christopher Waller and John Williams indicated a nearing decision to cut rates, with markets now fully pricing in a September cut.
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