The Indian rupee opened little changed against the US dollar on Monday amid uncertainty about the Middle East tensions and US election even as market participants watch closely for any action from the Reserve Bank of India.
The local currency started trading at Rs 84.075 per dollar, compared to the previous close of Rs 84.081.
The rupee is expected to trade in the Rs 84.00-84.20 range with a close watch on what RBI does to protect it from any further fall, said Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP.
While Forex Analyst Kunal Sodhani of Shinhan Bank India expects rupee to find support at Rs 84.03 and resistance at Rs 84.15-84.20.
The heightened uncertainty surrounding the Middle East and the US presidential election supports the safe-haven dollar, he said. Expectation of slower pace of Fed rate reductions also boosts the greenback.
The dollar traded near three-month high against major currencies. The dollar index, which measures the strength of the greenback against a basket of six currencies, stood at 104.53 (up 0.26%). The US 10-year bond yield was 4 basis points higher at 4.28%, pulling up the dollar index.
Brent crude oil prices fell over 5% to $72 per barrel, the lowest since the start of October, as the Israeli strike on Iran was less severe than feared, easing worries on supply. The risk premium is accordingly priced out of oil prices, Bhansali of Finrex Treasury said.
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