By Anushka Trivedi
MUMBAI, Feb 16 (Reuters) - The Indian rupee firmed
slightly against the U.S. currency on Thursday, as the dollar
index cooled and Asian shares advanced.
The rupee finished at 82.7175 per dollar, compared
with its close of 82.8025 in the previous session.
Volumes remained muted, but there is some positive risk
bias, leading to the rupee gaining ground, said a private bank
trader.
Its near-term support remains at 82.90 and resistance around
82.30, the banker added.
Outlook on the currency brightened a little after data on
Wednesday showed India's trade deficit in January shrank to a
one-year low, prompting economists to lower their estimates for
the country's current account gap for this fiscal year and the
next.
Research analysts at Citi recommended going long on the
rupee against some Asian peers, expecting the currency to
outperform, citing favourable seasonality and optimism over the
trade deficit. "We expect marginal appreciation in the rupee, it could go
to 82.20 soon," said Gaurang Somaiya, forex and bullion analyst
at Motilal Oswal Financial Services.
However, low forward premiums are not good enough for
exporters to sell their dollars, Somaiya said, adding that the
firm recommends investors wait for spot rupee to touch the
83-level.
USD/INR 1-year forward premium implied yield edged up to 2.08% on Thursday but was still down nearly 30 bps
so far this month.
The dollar index retreated in Asia after hitting a
more than one-month high overnight following robust U.S. retail
sales data.
This data comes on the heels of higher-than-expected
inflation and strong jobs data that could prompt the Federal
Reserve to hike rates multiple times.
However, Asian shares advanced broadly as they cheered the
strength in the world's top economy, with stocks rallying up to
2%, while Indian equities rose.
(Reporting by Anushka Trivedi; Editing by Dhanya Ann Thoppil)
anushka.trivedi.thomsonreuters.com@reuters.net))
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