By Jaspreet Kalra
MUMBAI (Reuters) – The Indian rupee declined on Thursday due to increased dollar demand from importers related to month-end payments and likely unwinding of long positions after it failed to hold above a key resistance level at 83.50.
The rupee was at 83.6850 against the U.S. dollar as of 10:45 a.m. IST, down 0.1% from its close at 83.5925 in the previous session.
Importers, including local oil companies, were spotted buying dollars, traders said.
A large foreign bank has also been consistently bidding for dollars, which is likely related to an unwinding of some long bets on the rupee, a trader at a foreign bank said.
Asian currencies were mixed while the dollar index was down 0.1% at 100.8.
While “inflows have been quite strong, especially in the debt market” over recent sessions, strong dollar demand between 83.45-83.50 has kept a lid on the currency’s gains, a trader at a private bank said.
The rupee rose to a near 3-month peak of 83.48 last week. Overseas investors have net bought about $10 billion of Indian equities and debt over September so far, the highest monthly inflow since December last year.
“Over the week, the (dollar-rupee) pair has opened lower, only to rebound as importers rush to meet month-end dollar demand, causing USD/INR to close higher,” Amit Pabari, managing director at FX advisory firm CR Forex said.
The attention on Thursday lies squarely on remarks from Federal Reserve Chair Jerome Powell who is slated to speak later in the day, alongside a host of other policymakers, and may offers cues on the future trajectory of policy rates.
(Reporting by Jaspreet Kalra; Editing by Nivedita Bhattacharjee)
Disclaimer: This report is auto generated from the Reuters news service. ThePrint holds no responsibilty for its content.