Rupee Rises To 82.32 As Asian Currencies Gained Against A Softer Dollar

The rupee gained on Friday as Asian currencies rose and the dollar index dipped as the third quarter's slowdown in US consumer and business expenditure pushed Treasury yields lower.

Bloomberg showed the rupee was last at 82.3225 per dollar after opening at 82.3813, compared to Thursday's close of 82.5025.

PTI reported that the rupee gained 4 paise to 82.29 against the US dollar in early trade.

It is "increasingly evident" that the 82 to 83 level is probably "the new range" for the rupee, a Mumbai-based trader told Reuters.

"The Federal Reserve meeting next week is a potential risk point, but we doubt it will have the impact of taking the rupee out of this range," added the trader.

In the previous session, while the domestic currency strengthened significantly to 82.15 in early trade, it weakened sharply after that, driven by broad-based dollar demand from importers taking advantage of the rupee's dip.

"The Indian rupee is expected to open slightly stronger at 82.40 after the dollar was bought yesterday, taking the rupee from a high of 82.1350 to a low of 82.50. The range for the day is expected to be 82.00 to 82.60," said Anil Kumar Bhansali, Head of Treasury at Finrex Treasury Advisors.

"The RBI has brought up a special meeting on Nov -3 to discuss inflation, which has consistently remained above 6 per cent. The meeting is after the Fed on 2nd November. The RBI will 
discuss on the contents of the letter to be written to the central government n the matter of inflation as steps taken by it to bring the same down," he added.

The demand for American government bonds was further boosted by the European Central Bank's less-than-hawkish recommendations, and the Reserve Bank of Australia and the Bank of Canada decided to raise interest rates less than investors had anticipated.

Those pivots from central banks and prospects the Federal Reserve would start to ease the pace of hikes following next week's meeting have caused traders to reevaluate their expectations.