Rupee almost unchanged at 90.94 against the dollar, likely RBI action eyed

Indian rupee

The rupee edged up 1 paisa against the dollar at the open on February 25, as traders retreated to the sidelines a day after the Reserve Bank of India (RBI) stepped in to defend the psychological vital 91 mark.

The currency was trading at 90.94 against the dollar after ending the previous session at 90.95 moving  in a narrow 6 paise range.

The rupee has stayed in a 30 paise range through the month, as both importers and the RBI have been buying and selling the greenback respectively, in order to take advantage of these trading levels, market participants said. Traders expect the rupee to continue to move in a range-bound manner.

Globally, investors sentiment is also sour, as market participants are still digesting the changes in tariffs structure introduced by President Donald Trump after the US Supreme Court struck down his reciprocal tariffs.

The dollar index slightly fell 0.1 percent overnight to trade at 97.12.

“Optimism around the reduced US tariffs faded, the dollar strengthened, and once again, the rupee found itself under pressure. Market participants believe that any sharper fall was likely cushioned by the steady presence of the Reserve Bank of India,” Amit Pabari, MD At CR Forex Advisors said.

Traders are tracking Trump's State of the Union address for clarity on fiscal policies.