Rupee opens 6 paise down at 85.85 against the dollar ahead of RBI policy

The rupee has been under pressure in the past few sessions due to dollar demand and equity outflows.

The rupee opened 6 paise down on June 6 ahead of Reserve Bank of India's (RBI) monetary policy announcement.

The currency opened at 85.85 against the US dollar after closing the previous session at 85.79.

The rupee has been under pressure in the past few sessions due to dollar demand and equity outflows, currency experts have said.

The RBI’s monetary policy committee (MPC) will likely to cut the repo rate by 25 basis points (bps), a Moneycontrol's poll of economists and treasury heads has shown. The third rate cut in a row will bring the repo rate down to 5.75 percent.

A lower consumer prices index (CPI) reading for a third consecutive month - below RBI’s medium-term target of 4 percent - has given the elbow room to cut benchmark rates further, with the central bank now focusing more on growth.

Retail inflation in April remained below the central bank's 4 percent target for the third consecutive month, as food prices rose at a slower pace.

Annual retail inflation slowed to 3.16 percent in April from 3.34 percent in the previous month, its lowest level since July 2019.