Indian Rupee Closes Weaker Against The U.S. Dollar

The Indian rupee closed weaker against the U.S. dollar on Monday.

The local currency weakened 7 paise to close at Rs 83.37 against the U.S. dollar on Monday. It closed at Rs 83.30 on Friday, according to Cogencis data.

The BJP has secured majorities in the Hindi heartland states of Rajasthan, Madhya Pradesh, and Chhattisgarh, strengthening the BJP's position as the dominant party in North India ahead of the general election in 2024.

'Premature To Rule Out Additional Rate Hikes'

"Dovish Fed expectations, falling U.S. bond yields undermine the USD. Fed Chair Jerome Powell said it was premature to rule out additional rate hikes or start discussing cuts, but overall tone seemed to be dovish," Kunal Sodhani, vice president, Shinhan Bank said.

"For dollar-rupee, Rs 83.10-83.15 will act as a support while Rs 83.35 would be the resistance," he said.

'Next Significant Event Will Be RBI's MPC'

"The next significant event on the domestic front will be the RBI’s monetary policy announcement on Dec. 8. On the forex reserves front, RBI’s reserves surged by $2.53 billion to $597.94 billion for the week ended Nov. 24. The increase is primarily attributed to higher valuations of U.S. Treasuries, foreign currency assets, and gold," Amit Pabari, managing director at CR Forex Advisors said.

'FDIs To Continue After The Win Of The Incumbent Government'

"Indian rupee is expected to trade within a small range with a bit of appreciation bias as flows, IPOs, FDIs to continue after the win of the incumbent government, but dollar buying due to various reasons to continue," Anil Kumar Bhansali, head of treasury and executive director Finrex Treasury Advisors LLP said.

"Rupee is going to remain in the range of 83.20/83.45 in the next few days as this shortage continues and RBI keeps supplying dollars to help curb the demand. Market awaits for RBI monetary policy and NFPR on 8th".