MUMBAI: The Indian rupee is expected to struggle on Thursday after it was unable to move past the key resistance level of 83.50 and as traders eye comments from Federal Reserve Chair Jerome Powell for cues on the pace of US interest rate cuts.
The 1-month non-deliverable forward indicated that the rupee will open at 83.63-83.65 to the US dollar compared with 83.5925 in the previous session.
In each the last three sessions, the rupee has been unsuccessful in climbing past 83.50, a level which market participants say is important for the currency to take out to sustain its upward momentum.
Indian rupee’s upside seen largely capped at current level
“Most think that 83.40-83.50 will be very difficult (for the dollar/rupee) pair to break and the recent price action has validated that,” a currency trader at a bank said.
The rupee’s cause will not be helped considering that the “enthusiasm” in the Asia FX space on account of the China stimulus had “dimmed somewhat”, he said.
The trader expects the rupee to drift lower to 83.75, the middle of its recent trading range, over the next few sessions, ,
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