Indian rupee to remain mired near all-time low on global risk aversion

MUMBAI: The Indian rupee is expected to hold near lifetime lows on Wednesday amid a selloff in risk assets on concerns over the US growth outlook.

The 1-month non-deliverable forward indicated the rupee will open at 83.96-83.97 to the US dollar compared with 83.9675 in the previous session.

The local currency’s all-time low is 83.9725, hit in the first week of last month. Japan led Asian equity gauges lower with a more than 3% decline following the selloff on Wall Street.

The S&P 500 Index had its worst day in a month and futures indicated a further decline. Data that indicated US manufacturing activity remained weak and a plunge in shares of Nvidia soured risk appetite.

Indian rupee ends moderately higher

In wake of the risk off, the rupee will take support from the “always present” Reserve Bank of India, the slump in oil prices and the decline in US Treasury yields, a currency trader at a bank said.

“And, it’s not like the equity selloff is having an impact on Asian currencies,” he said. The rupee “should spend the day” in a 83.94-83.97 range.