By Nimesh Vora
MUMBAI (Reuters) – The Indian rupee was higher on Monday, helped by persistent equity inflows, but was not seen strengthening past an established resistance, traders said.
The rupee was quoted at 81.9525 to the U.S. dollar by 11:20 a.m. IST, up from 82.0350 in the previous session.
In four days, from Monday to Thursday last week, foreign investors bought $1.7 billion worth of Indian equities, NSDL data shows. The data for Friday will be published later in the day.
India’s fundamentals look promising and that probably is providing a fillip to portfolio flows, Amit Pabari, managing director at CR Forex, said.
Reserve Bank of India will probably absorb the inflows and continue to build up reserves, he added.
The USD/INR pair has been supported at the 81.80-81.90 level over the last two weeks.
“Think this week too, 81.80 will be difficult to take out and we will just amble along in a narrow range,” an FX trader said.
Other Asian currencies were mostly lower amid weak risk appetite. The offshore Chinese yuan dropped below 7.22 to the dollar.
The rupee has been mostly unresponsive to the recent weakness of the yuan, pushing the CNH/INR pair to the lowest level since November 2022.
The dollar index dropped to near 102.70. The focus this week will be on the U.S. jobless claims, core personal consumption expenditure and the GDP data. The reports could provide cues on the likelihood of the Federal Reserve following through on its projections of two more rate hikes this year.
(Reporting by Nimesh Vora; editing by Eileen Soreng)
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