MUMBAI: The Indian rupee is expected to draw support on Friday from the US dollar’s decline on upbeat risk appetite and a further slide in Treasury yields.
Non-deliverable forwards indicate the rupee will open flat-to-slightly higher against the dollar from 83.2425 in the previous session.
The dollar index was “looking soft” and has being “well offered” in London/New York over the past three session, a spot trader at a private bank said.
That is a positive for the rupee but with oil companies and state banks lapping up dollars, the local currency has stayed within the “original” range, he said.
The rupee has been trading in a 83.0225-83.2950 range over the last six weeks. The US 10-year Treasury yield receded in the New York session and was at 4.66% in Asia.
The dollar index posted a low of 105.80 in New York, before recovering to near 106.12.
US equities rallied with the S&P 500 index having its best day since April.
Markets continued their “sugar high” from this week’s Federal Reserve meeting, when Chair Jerome Powell hinted that the Fed may be done hiking, MUFG Bank said in a note.
The number of Americans filing fresh claims for unemployment benefits increased moderately last week, indicating slight softening of the labour market, data on Thursday showed.
Asian currencies added to Thursday’s advance with the Korean won and Indonesian rupiah leading the way.
India rupee falls to record low
Focus now shifts to the US services and jobs data due later on Friday.
The services data will come after the weaker-than-expected manufacturing print while non-farm payrolls are expected to moderate to 180,000 from 336,000 in the prior month, according to a Reuters poll.
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