Rupee opens 3 paise down at 89.25 on persistent dollar demand

Indian Rupee

The rupee opened 3 paise down on November 26 due to persistent demand for American currency among importers despite the easing of dollar index amid  rising expectations of a US rate cut next month, experts said.

The rupee opened at 89.25 against the US dollar after ending the previous session at 89.22.

Importers have been buying dollars whenever the rupee strengthens, which has made it hard for the rupee to keep rising, currency experts said.

The dollar index slipped below the 100 mark as weak US consumer data lifted bets on a US Federal Reserve interest-rate cut next month.

The index, which measures the greenback's strength against a basket of six major currencies, fell to 99.66 in the morning from the above 100 mark.

Weak US data, dovish remarks from Fed officials and a Bloomberg report suggesting Kevin Hassett could replace Jerome Powell when his term concludes in May added to expectations of a softer Fed stance, making a December cut appear increasingly likely.

"In the near term, the rupee is likely to move within a broad 88.90-89.80 range. The 88.80–89.00 band continues to act as a firm support zone," said Amit Pabari, managing director at CR Forex Advisors.