Rupee may trade flat to slightly positive today

The rupee on Wednesday closed at around 61.43 against the dollar. According to CNBC-TV18’s Latha Venkatesh, the currency market is going to be little elated. One would have expected the steps by the government to give a lot of strength but unfortunately it is coming on a day when global cues are not on the side of the rupee. But one can see flat to slightly positive trading for the rupee today.

The idea of putting the clock back on reforms is not the way foreign institutional investors (FIIs) are looking at the market. The FIIs are looking at the fact that government and the Reserve Bank of India (RBI) have done everything possible to give confidence to the rupee.
In any case the overseas direct investments (ODI) were not looking for assets abroad. It isn’t as if Indian companies were raising money left or taking money out to do mergers and acquisitions (M&A) abroad. Since no M&A activity was taking place, putting any restriction there will not be very negative.
"The morning can start on a positive note, maybe the dollar would be cheaper than 61/USD but because there has been such a global dollar buying spree it has mellowed a little as we get closer to the Asian trading," she adds.
But it is still strong dollar vis-à-vis the Indonesian Rupiah (IDR), Brazilian real, people with whom we should compare the Indian rupee. Since those are on the back foot compared to the dollar, one can expect dollar to open not at 61/USD or sub-61/USD but maybe closer to 61.25-61.35/USD, so that will still be 10 paise better than where it closed on Wednesday. Thereafter, much will depend on the course of the equity market as well. However, one will not see dollar weakness, one will not see too much of rupee weakness. One may not see too much of strength.