Published 08:26 IST, March 27th 2024
Rupee may stabilise despite pressure from weakening Yuan
Forecasts from non-deliverable forwards suggest that the rupee will largely maintain its previous close against the US dollar.
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Rupee in focus: The rupee is anticipated to open flat on Wednesday, although it may encounter some downward pressure due to the depreciation of the offshore Chinese yuan, which has led to declines in several Asian currencies.
Forecasts from non-deliverable forwards suggest that the rupee will largely maintain its previous close against the US dollar.
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The dollar index has edged higher, while the offshore Chinese yuan experienced a slight decline.
The Japanese yen also weakened, reaching its lowest level since 1990.
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Last week, the rupee faced pressure as a result of the yuan's depreciation, coupled with outflows of dollars, pushing it to a record low.
However, the currency saw a modest recovery on Tuesday, potentially supported by central bank interventions and inflows from remittances.
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Recent US data showed mixed results, with durable goods orders surpassing expectations in February, while consumer confidence fell short of forecasts.
India's current account deficit (CAD) narrowed in the October-December quarter compared to the previous year, signalling an improvement in the country's external position, bolstered by record-high foreign reserves.
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DBS Bank expects the rupee to trade within a specific range this week, anticipating exporters' activity and increased central bank intervention to stabilise the currency.
Investors will be attentive to remarks from Federal Reserve Board Governor Christopher Waller, as Fed officials continue to monitor inflation trends with a cautious outlook.
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(With Reuters Inputs)
08:26 IST, March 27th 2024