Next week, we expect USD/INR to trade within 71-71.60, dollar flows related to Dmart’s QIP may cap the appreciation in spot, says Rahul Gupta, Head of Research- Currency, Emkay Global Financial Services.
The Indian rupee has erased some of its morning gains but trading marginally higher at 71.37 per dollar, with selling seen in the domestic equity market.
It opened higher at 71.34 per dollar versus Friday's close of 71.40.
On Frday, the rupee slipped 22 paise to end at 71.40 against the US dollar amid selling in domestic equities and strengthening of the American currency overseas.
"Since the start of this month, USD/INR has been on a bearish note amid expansionary budget and RBI policy. Meanwhile, despite China inventing a vaccine to contain the coronavirus, the worries over it spreading rapidly has turned market sentiments mixed," said Rahul Gupta, Head of Research- Currency, Emkay Global Financial Services.
Going ahead, if the number of infected cases increase then it will dent the risk appetite even further, putting downward pressure on Emerging market currencies. Next week, we expect USD/INR to trade within 71-71.60, dollar flows related to Dmart’s QIP may cap the appreciation in spot," he added.Oil prices on Monday extended their decline from an early January peak above $70 as the spectre of excess supplies loomed over the market after the spreading coronavirus outbreak hit demand in China, the world's largest oil importer.
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