By Anushka Trivedi
MUMBAI, Jan 31 (Reuters) - The Indian rupee eased on
Tuesday against a stronger dollar, with investors keeping a
close eye on equity markets while they awaited the domestic
Union budget and the U.S. Federal Reserve meeting.
The rupee fell to 81.67 per dollar by 10:15 a.m.
IST, compared to its previous close of 81.4950. The currency is
headed for a monthly gain of about 1.3%, relatively less than
its peers.
However, traders reckon the rupee has held up better than
expected through the massive selloff in Indian equities after a
U.S. short-seller report on Adani Group last week flagged
concerns about their debt levels and the use of tax havens.
"The rupee has been resilient in spite of the about $2.5
billion foreign portfolio outflow in January, the highest since
June of last year," said Anindya Banerjee, head research - fx
and interest rates at Kotak Securities.
"We suspect corporate inflows and some bit of intervention
(from the central bank) may have played a part," he said,
expecting the rupee's 81.40-81.80 rangebound trading to resolve
into a trend before the weekend.
The budget - where the focus will be on the government's
fiscal consolidation path - and the Fed meeting are both due on
Wednesday and would likely be key triggers.
Ahead of that, India's annual pre-budget economic survey is
due later in the day, in which the government is likely to peg
GDP growth at 6-6.8% for 2023-24, the slowest in three years,
Reuters reported.
Meanwhile, most Asian emerging market stocks and currencies
fell as the dollar index climbed above the 102 level
overnight, with caution setting in ahead of the Fed meeting,
which will be followed by European and England central bank
decisions on Thursday.
While a 25-basis-point hike is widely expected from the Fed,
a key marker would be how the officials respond to markets
pricing in rate cuts later this year.
(Reporting by Anushka Trivedi; Editing by Savio D'Souza)
anushka.trivedi.thomsonreuters.com@reuters.net))
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