By Anushka Trivedi
MUMBAI, March 10 (Reuters) - The Indian rupee weakened
on Thursday but held up better than its Asian peers, as risk
assets were sold off in the region ahead of a critical U.S. jobs
report.
The rupee was trading at 82.0350 per dollar by
10:50 a.m. IST, compared with its previous close of 81.9750.
Over the past few trading sessions, the rupee has pulled
back from opening lows and kept up the trend of outperforming
its Asian counterparts.
The seasonality factor was at play here, with March seeing
capital inflows as the final month of the fiscal year, said a
private bank trader.
A decline in oil prices also helped, as Brent crude futures shed 5.5% this week to $81.15 per barrel. "Overall, we expect the rupee to trade in the range of
81.50-82.50 levels in March," said Amit Pabari, managing
director at CR Forex Advisors.
Asian emerging market currencies dropped and equity gauges
tumbled between 0.70% to 2% as U.S. stock futures extended
declines on fears Friday's February jobs report could spur more
aggressive interest rate hikes from the Federal Reserve.
The report has become more crucial since Fed chair Jerome
Powell this week made hawkish comments and said the central bank
would be data-dependent.
Investors will be cognizant of the fact that a big surprise
in January data acted as a trigger for markets last month to
price in a higher-than-expected Fed terminal rate.
Markets have now raised their expectations of a 50-basis
point (bps) hike to 60% after Powell's remarks, compared to 31%
a week ago, as per the CME FedWatch tool.
Risk assets got no reprieve from a substantial cooldown in
U.S. bond yields after data overnight showed a rise in weekly
jobless claims. The two-year yield declined 13 bps
during the Asia trading session to 4.77%.
(Reporting by Anushka Trivedi; Editing by Janane Venkatraman)
anushka.trivedi.thomsonreuters.com@reuters.net))
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.