Rupee started the day higher versus the dollar at 82.58, up 13 paisas from its previous close of 82.72 on Tuesday as the value of the dollar against a basket of six peers remained stable. Tuesday saw a decline in the price of crude oil, helping the currency. A weaker dollar and upbeat global market sentiment are expected to boost the local currency today. Investors will also pay particular attention to US CPI data, which is predicted to reveal that annual inflation in the US fell from 6.5% to 6.2%.
Meanwhile, as India’s inflation increased more than anticipated in January and rose above the RBI’s comfort level, significant gains may be avoided. According to ICICI direct, “the US$INR is projected to decline towards the level of 82.50.”
“Market players are still being cautious ahead of today’s US inflation report. Inflation is predicted to decline in January, which could cause the dollar to retrace a bit against its major crosses. We anticipate a sideways movement in the USDINR(Spot) and a price around the 82.40–82.90 band, according to Gaurang Somaiya, a forex and bullion analyst with Motilal Oswal Financial Services.
“After a string of outflows, FII turned buyers in Indian equity yesterday, but little buying was observed. Since there are no significant events scheduled, attention is nonetheless paid to the US CPI to provide direction for the local and international markets. According to Amit Pabari, MD of CR Forex Advisors, the USDINR pair is anticipated to consolidate in a narrow range between 82.40 and 82.80 levels.