Rupee to hover in 59-59.30/$ range: Latha Venkatesh

The rupee clawed back a percent in trade on Tuesday as the Reserve Bank of India (RBI) cracked the whip. According CNBC-TV18’s Latha Venkatesh, the US dollar may remain in a tight range. Level of 60 per USD is being seen as a line in the sand which RBI and the government are determined to defend. So, people will be very scared to take long dollar positions. The rupee will remain in 59-59.30/USD range and then take cues along.

It doesn’t look like the global cues are giving a very strong stock market cue when compared with the dollar Asia rather than the dollar index. Dollar index is weak. Dollar Asia is mixed, the rupee, the Philippine peso are stronger, there are other currencies that are weaker. So, the global cues will not call the tune much, it will again be a domestic day.
People will be scared to short the rupee or go long the dollar. Foreign direct investment (FDI) announcements will have a positive impact on the rupee. Also, the tightness in the money market will only get worse because the control of Rs 75,000 crore on borrowing from RBI in the repo window kicks in today. The tightness in the money market will continue to mean that if people have long dollar positions, they will sell them and convert into rupee because rupee is a scarce commodity at this juncture.