Rupee premiums dipped more, with the 1-year implied yield now at 2.38%. On bank of the Reserve Bank of India's unexpected status quo on rates, the 1-year is down about 20 bps. (Reporting by Nimesh Vora; Editing by Varun H K)
By Nimesh Vora
MUMBAI, April 11 (Reuters) - The Indian rupee declined
slightly to the U.S. currency on Tuesday, likely on account of
persistent dollar demand from importers looking to hedge
near-maturity liabilities, traders said.
The rupee was at 82.0475 to the dollar by 11:00
a.m. IST, down from 81.98 in the previous session. The local
currency on Monday reached 81.78, the highest level in a month.
"It's a little surprising that we are back to 82. We have to
put it down to the routine dollar demand from oil and other
importers," a trader at a mid-sized private sector bank said.
Importers remain inclined to hedge their near-term payables
when USD/INR drops below 82, he said.
The near support level for the rupee is pegged at 82.20.
"Once USD/INR pair surpasses the 82.20 zone, it would yet
again move towards 82.50-82.70 territory before marching
higher," Amit Pabari, managing director at CR Forex, said.
"All eyes are on the release of inflation data in India and
the U.S."
The India and U.S. inflation data are due on Wednesday. The
U.S. print is considered more crucial by traders from the
rupee's point of view, and will be instrumental in the Federal
Reserve's decision on whether to raise rates at its May meeting.
Economists polled by Reuters expected core consumer price
index to rise 0.4% month-on-month.
Futures reckon there is now a near-70% chance that the Fed
will hike rates in May, following the U.S. jobs report and on
diminishing worries over the U.S. banking sector.
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.