By Anushka Trivedi
MUMBAI, Feb 20 (Reuters) - The Indian rupee inched up on
Monday, tracking Asian peers as the dollar index stalled after a
recent rally, with investors awaiting minutes of the Federal
Reserve meeting due mid-week.
The rupee finished at 82.7225 per U.S. dollar,
compared with its previous close of 82.83.
Asian currencies recovered slightly on Monday after last
week's selloff, with the Thai baht and the Philippine
peso gaining around 0.7% and 1%, respectively. The dollar index backed down from a six-week peak to
103.850, dropping below a key 104 threshold. It had gained about
0.9% over the past fortnight.
Fed officials' hawkish comments, coupled with recent
inflation, retail sales and jobs data in the United States, have
strengthened the case for the U.S. central bank hiking rates
multiple times this year, fuelling a dollar rally.
Fed funds future indicates a near-80% chance of two 25 basis
point hikes at the next meetings, with a 53% probability of
another similar-sized hike in June, according to the CME
FedWatch tool.
Economists at Indian banks expected the country's central
bank to keep intervening amid this period of volatility after
data showed the RBI's forex reserves fell $8.32 billion to
$566.95 billion in week-ended Feb. 10. "We don't expect a sustained appreciation in the rupee till
the Fed's rate hike path is clear," said Aditi Gupta, an
economist at Bank of Baroda.
Minutes from the Fed's February meeting due on Wednesday
during U.S. hours would be crucial, while a few its officials
are also scheduled to speak this week.
The core personal consumption expenditure (PCE) price index
data, Fed's preferred gauge for inflation, is due on Friday.
(Reporting by Anushka Trivedi; Editing by Sohini Goswami)
anushka.trivedi.thomsonreuters.com@reuters.net))
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