In spite of a sluggish trend in domestic stocks, the rupee steadied in a small range on Tuesday to conclude the day barely 1 paisa higher at 82.62 (provisional). In anticipation of the RBI’s monetary policy announcement later this week, market participants are alert and the rupee is trading in a limited range.
There is a general expectation that the central bank would maintain the repo rate at 6.5 percent. According to forex traders, pressure on the native currency was further maintained by a strengthening dollar on global markets. The local currency at the interbank foreign exchange market started at 82.56 versus the US dollar and ended at 82.62 (provisional), up 1 paisa from its previous level.
The domestic unit experienced an intraday top of 82.56 and a low of 82.66 throughout the day. The rupee’s closing value versus the US dollar on Monday was 82.63. The dollar index, which measures the value of the dollar against a basket of six different currencies, increased 0.12% to 104.12. Brent crude futures, the benchmark for all crude oil, fell 1.60 percent to USD 75.48 per barrel.
The Reserve Bank’s rate-setting monetary policy panel, according to forex dealers, started deliberations on Tuesday. The six-member Monetary Policy Committee (MPC), which is chaired by Reserve Bank Governor Shaktikanta Das, will meet for three days and make its decision on Thursday.
