Indian Rupee Strengthens Against U.S. Dollar

The Indian rupee closed stronger against the U.S. dollar on Wednesday, ahead of the outcome of the Fed meeting.

The local currency strengthened by 7 paise to close at Rs 83.04 against the U.S dollar. It ended at Rs 83.11 on Tuesday, according to Bloomberg data.

Rs 83.15-83.30 will act as a roof for the rupee, where RBI may also offload their dollar reserves along with exporters' selling, according to Amit Pabari, managing director at CR Forex Advisors. Whereas, on the downside, Rs 82.70–82.80 will be acting as support, and if that is taken out, then a move towards Rs 82.50–82.20 can be immediately targeted.

"Strong US labor market and consumer confidence contrast could affect Fed officials rate cut forecasts. Fed is broadly expected to hold rates steady today, but markets will be looking for a dovish pivot from Fed Chairman Jerome Powell to reignite rate cut hopes. DXY is finding a resistance at 103.85 levels," said Kunal Sodhani, vice president of Shinhan Bank.

"For dollar/rupee, Rs 83.00 will acts as a support and Rs 83.25 as a resistance," he said.