Rupee opens slightly weaker at 93.73 per dollar as the greenback firms

what happened

According to Finrex, the rupee opened 4 paise lower at 93.73 per dollar, versus 93.69 at the previous close. The dollar index rose 0.63% to 102.85, its highest since October 14, supported by expectations of a Federal Reserve rate hike. The euro fell below 1.11, a level not seen in 18 months.

Foreign investors bought about Rs 12,000 crore, more than $1.25 billion, of Indian equities the previous day, which supports the rupee. Brent stayed above $90 and traded near $92.21 a barrel in the morning. Most Asian currencies were mixed: the Indonesian rupiah lost 0.48%, the Philippine peso 0.34%, while the Japanese yen gained 0.09%, nearing the 160-per-dollar mark.

Finrex is awaiting Indian inflation data, which is expected to come close to 6% for October.

why it matters

Two forces are shaping markets: a firm dollar on expectations of tighter Fed policy and capital inflows into India. Finrex says exporters keep selling dollars on rallies, while importers may buy dollars on dips toward 93.50.

market impact

Rupee and Asian currencies: strong dollar and inflows into India create mixed pressure

• ↔Indian rupee mixed — a strong dollar weighs on the rate while foreign equity buying supports it
• ▼Euro pressure down — the rising dollar index pushed the euro to 18-month lows

tags

instruments