The rupee has reached a new one-month high of 82.23 against the US dollar
The domestic currency opened at 82.29 per dollar and reached a high of 82.23 per dollar, a level last seen on December 9th. The native currency was trading at 82.23 per dollar at 9:30 a.m., up 0.3% from its previous close of 82.36.
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The rupee climbed to a new one-month high versus the dollar on Tuesday, matching advances in its Asian rivals after US wage data suggested the Federal Reserve may ease up on its aggressive rate hikes.
The domestic currency opened at 82.29 to the dollar and reached a high of 82.23 to the dollar, a level last seen on December 9. The native currency was trading at 82.23 per dollar at 9:30 a.m., up 0.3 percent from its previous close of 82.36.
"Markets have interpreted the recent US statistics as evidence that the economy is progressively slowing, and if this trend continues, the Fed may reduce its interest rate hike from 50bps to 25bps at its next policy meeting. This will keep the DXY under control and limit gains to around 105.50 levels "CR Forex Advisors stated in its most recent research.
According to brokers, the rupee was helped by a stronger yuan and lower crude oil. The yuan strengthened as China reopened its borders with Hong Kong for the first time in three years on Sunday, implying an end to the country's strict zero-Covid policy.
Decreasing US Dollar Index, which is trading near a seven-month low due to the Fed's less hawkish tone and worse US economic data, and falling oil prices - which should assist to relieve pressure from the country's widening trade deficit, according to dealers.
Domestically, a better purchasing managers index and inflation that is within the RBI's target range are also helping to bolster optimism.
Traders are now looking forward to this week's inflation reports from the United States and India for additional signals.
"The rupee may strengthen more as the dollar index falls and the market anticipates Fed signals on interest rate hikes as well as the US inflation report due on Thursday. Stronger Asian currencies will keep the rupee well bid, however oil corporations may come to buy the dollar, preventing the rupee from appreciating significantly. CPI inflation in India is predicted to be about 5.90 percent, the same as last month "Anil Kumar Bhansali, Head of Treasury Finrex Treasury Advisors LLP, elaborated.
