Indian rupee opens 16 paise lower at 86.57/USD on dip in Asian currencies, eye on FOMC next week

Indian rupee

The Indian rupee opened 16 paise lower at 86.57 against the US dollar on July 25, following a dip in Asian currencies and uptick in dollar index, as compared to 86.41 at previous close.

Anil Kumar Bhansali, Head of Treasury and Executive Director at Finrex Treasury Advisors LLP said the Asian markets are reflecting a cautious and subdued tone across major economies as investors weighed global trade developments, and uncertainty over rate cuts by the US Federal Reserve.

Asian currencies snapped their longest winning streak since January, with South Korean Won 0.27 percent lower versus previous close, Philippine Peso down 0.26 percent, Japanese Yen and Indonesia Rupiah down 0.12 percent each, and Thai Baht down 0.05 percent in early trade, as per Bloomberg data. The onshore yuan rose to as high as 7.1478 per dollar on July 24, a level last seen in November, before closing marginally lower.

The dollar index was trading up in early trade at 97.609 as compared to 97.377 at previous close. Strong US jobs data on July 24 dampened hopes for imminent US rate cut ahead of the central bank’s meeting next week.

Experts said that rupee could remain under pressure as investors will watch out for US President Trump's tariff deadline, Federal Reserve policy decision, and key US economic data releases, next week.

"For USDINR, 86.15/20 acts as a support while 86.60 a resistance," said Kunal Sodhani, Head of Treasury at Shinhan Bank.