Rupee logs weekly decline, likely to trade sideways
Advertisement

Rupee logs weekly decline, likely to trade sideways

By Reuters

  • 05 Jul 2024
Rupee logs weekly decline, likely to trade sideways
A person holds Indian currency notes in New Delhi. | Credit: Reuters/Priyanshu Singh

The Indian rupee closed nearly unchanged on Friday as importer dollar demand weighed on the currency, even though most of its Asian peers gained ahead of the release of closely watched U.S. jobs data later in the day.

The rupee ended at 83.4850 against the U.S. dollar, barely changed from its close at 83.4925 in the previous session. The currency was down 0.1% week-on-week.

Major Asian currencies rose between 0.1% to 0.3% but the rupee lingered in a tight band as dollar demand from local oil companies and importers capped gains, traders said.

Advertisement

The dollar index fell 0.2% to hit its lowest in three weeks at 104.95, pressured by strength in the euro and the British pound.

The rupee is expected to "continue trading sideways between 83.35 and 83.70," Dilip Parmar, a foreign exchange research analyst at HDFC Securities said.

The currency's rangebound price action has also driven down near-term volatility expectations with the 1-month implied volatility dropping to 1.8%, the lowest since mid-March.

Advertisement

Focus now turns to the U.S. non-farm payrolls report due later in the day, which is expected to influence expectations of when the Federal Reserve may begin to ease policy rates.

Weakness in economic data released earlier in the week boosted odds of a Fed rate cut in September to 74%, up from about 66% a week earlier, according to the CME's FedWatch tool.

Data due on Friday is expected to show that U.S. unemployment rate held steady at 4% in June while the economy added 190,000 jobs, down from 272,000 in the previous month, according to economists polled by Reuters.

Advertisement

Share article on

Advertisement
Advertisement
Google News Icon

Google News

Follow VCCircle on Google News for the latest updates on Business and Startup News