Rupee opens flat against US dollar

Indian rupee opened marginally lower against the US dollar tracking weaker global equity and currencies markets.

At 9.10am, the home currency was trading at 83.31 a dollar, down 0.03 percent from its previous close of 83.29.

India’s benchmark Sensex lost around 900 points or 1.2 percent in the last two trading sessions.

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Asian currencies were trading weaker after US federal reserve meeting minutes indicated interest rates will remain elevated for longer. Attention will now turn to upcoming US jobs data on Friday after minutes from the Fed’s December meeting suggested rates could remain at restrictive levels for some time.

In December, the Fed discussed an upcoming change in US monetary policy. Powell suggested the end of interest rate hikes and a potential interest rate cut by the end of 2024. Initially, markets expected a 175 bps cut, but now it’s around 150 bps due to reduced scepticism.

Investors are favouring the US Dollar due to risk aversion, which might strengthen the Dollar and lead to corrections in equities as rate cut expectations decrease, analysts said.

South Korean won fell 0.4 percent, Indonesian rupiah declined 0.26 percent, Taiwan dollar lost 0.2 percent, Malaysian ringgit 0.16 percent, Philippines peso and China renminbi lost 0.08 percent each.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 102.478, down 0.02 percent from its previous close of 102.494.

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