MUMBAI: The Indian rupee is likely to open marginally higher on Wednesday tracking non-deliverable forwards, but higher crude oil prices and a nearby support on USD/INR is likely to limit the upside.

Non-deliverable forwards (NDF) indicate rupee will open at around 82.86-82.90 to US dollar compared with 82.9225 in the previous session.

Brent crude reached a 10-month high of $92.40 in the New York session on Tuesday on supply worries, and is now up 6% month-to-date.

Meanwhile, the dollar index was barely changed at 104.60, while Asian currencies and equities were mixed.

NDF is pointing to bit of a lower opening on USD/INR, “but taking into account oil prices and the support of 82.80”, it will likely “be a struggle” for the rupee to hold the opening, a forex trader at a bank said.

The lower-than-expected India inflation print was a positive for the rupee “at the margin”, he added.

The central bank intervened in the last half hour of the normal over-the-counter trading hours on Tuesday, two traders at a private bank said, a positive for the rupee. India’s consumer price index-based inflation data released Tuesday showed that year-on-year inflation came in at 6.83%, lower than a Reuters estimate of 7%.

“CPI data would vindicate monetary policy committee’s stance to ‘look through’ this supply side inflation shock… expect MPC to acknowledge these positive developments and tone down its inflationary concerns,” Citi Bank said in a note.

Focus now shifts to the US inflation data due later in the day.

Core CPI is expected to rise by 0.2% month-on-month in August, at the same rate as July, according to a Reuters poll.

“Core inflation, which has been much stickier… could now benefit from more helpful base effects,” ING bank said in a note.