Rupee opens 5 paisa down at 90.65 against dollar, traders stay on sidelines

Indian rupee

The rupee opened marginally down on February 16 despite a muted US dollar, as traders stayed on the sidelines after the US inflation print strengthened the case for a rate cut.

The rupee was trading at 90.65 to the dollar after ending the previous session at 90.60, down 5 paise. The rupee traded in a narrow range in the previous session as traders looked for cues.

In the US, consumer prices slowed to 2.4 percent in January from 2.7 percent in December, bolstering the case for at least two more rate cuts from the Federal Reserve, which put the dollar on the backfoot.

The dollar index was trading at 96.92, as compared to 96.94 previously.

At home, importers are persistently looking to hedge positions as they consider the current trading levels to be attractive to buy the greenback.

The Reserve Bank of India (RBI) was also likely seen in the market, selling the dollar to prevent a sharp appreciation in the currency, experts said.

“The RBI has maintained a range of 90.40 to 90.80 for the rupee in the last few days of the previous week. The rupee should remain in a small range during the day,” Finrex Treasury Advisors said.

Traders will now be tracking the US Federal Open Market Committee minutes and economic growth figures from the world’s largest economy later in the week for further cues.