Rupee opens lower, may depreciate further amid pressure from external factors, strong dollar demand

Rupee opens lower, may depreciate further amid pressure from external factors, strong dollar demand

The Indian rupee opened marginally lower at 81.67 per dollar on Friday, down from the previous close. The local unit is expected to trade in a range of 79-82 against the US dollar in 2023 as it may continue to face pressure from external factors, according to experts. “Maybe 80-82 in first quarter of next year, 79 to 81 Q1 of next fiscal, not much difference in the second half,” said Soumya Kanti Ghosh, Group Chief Economic Adviser, SBI, speaking at the 9th SBI Banking and Economics Conclave – 2022. In the previous session, rupee appreciated by 23 paise to close at 81.70 against the greenback as a weak greenback in the overseas market and a rally in domestic equities boosted investor sentiment.

Raj Deepak Singh, Analyst – Currency, F&O, and Commodities, ICICIdirect

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Anindya Banerjee, VP – Currency Derivatives & Interest Rate Derivatives at Kotak Securities

“USDINR spot closed 21 paise lower at 81.63, as traders sold dollars after US Fed minutes indicated that US rates are about to peak. Rupee has been an underperformer over the last fortnight, primarily on account of demand for USD from OMCs and some bids from FPIs. However, weak USD and strong risk sentiments can continue to push USDINR lower, towards 81.25/30 levels. We expect an overall range of 81.25 and 81.85 on spot.”

Amit Pabari, MD, CR Forex Advisors

“USDINR continued to trade in a tight range of 81.60-81.90 levels for the past few sessions. It is observed that the RBI is suspected to intervene around 81.90 levels, which shows that they want to keep USDINR stable between 80.50-82 levels for now. Indian equity Indices surged to a new all-time high on the back of improved global risk-appetite. FII flows in November month remained the strongest point for the Rupee gains. The overall risk-on sentiment amongst the EM currencies could push the pair towards 81.20 levels. Until the pair remains below the 82.00 mark, selling on the rise is suggested for the near term.”

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Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services

“Rupee in the last few sessions has been stuck in a range of 81.40 and 81.80 and yesterday was another day of consolidation. No major cues on the domestic and global front kept the volatility in check for the currency. The dollar did get some momentum after the FOMC meeting minutes that was released earlier this week. The minutes suggest that Federal Reserve officials expect to switch to smaller interest rate increases “soon” and also expressed concern over the impact rate increases could have on financial stability and the economy. Yesterday, volatility for major crosses was lower as US markets remain shut on account of Thanksgiving day holiday and today could witness another day of consolidation. We expect the USDINR(Spot) to trade sideways and quote in the range of 81.20 and 81.80.”