The Indian rupee was little changed on Tuesday after surrendering its opening gains due to the dollar demand from corporates, traders said.
The rupee was at 82.6325 to the U.S. dollar by 10:46 a.m. IST, barely changed from the previous session. The currency had inched up to 82.5850 at the open.
“The big corporates (who are importers) are quite active on the dips (on USD/INR), which, in the current context, makes sense,” a forex salesperson at a private bank said.
“Then there is the usual (dollar) demand that we see at this time of the month.”
The rupee reached 82.36 last Thursday but has struggled since due to the demand from importers.
Anil Bhansali, head of treasury at advisory firm Finrex Treasury Advisors, said he is telling his importer clients to buy the dips on the USD/INR.
Other Asian currencies rose between 0.1% and 0.4%, helped by the dollar index’s drop to 103.82 and the dip in U.S. Treasury yields. The 2-year yield fell to 4.99%.
A healthy risk appetite helped. China equities continued to rally after Beijing, over the weekend, introduced a package of measures to boost markets.
Investors’ focus now turns to the slew of U.S. data due later this week, which will help them assess how the economy is faring and gauge the outlook for interest rates.
Federal Reserve Chair Jerome Powell was more hawkish at Jackson Hole last Friday than he was in July, prompting investors to raise the odds of one more rate hike this year.
