By Siddhi Nayak
MUMBAI, – The Indian rupee closed marginally lower after a range-bound trading session on Monday, tracking a decline in most regional peers ahead of data that could help gauge the timing of a policy reversal by the Federal Reserve.
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The rupee ended at 83.53 to the U.S. dollar, down from 83.50 in the previous session. The domestic unit traded in a narrow four-paise range in Monday’s session.
Major Asian currencies fell 0.1% to 0.7% to begin the week ahead of U.S. inflation data, due Wednesday. The print is expected to offer cues on when the Fed could deliver a rate cut this year and by how much.
“With inflation levels remaining stubbornly high, the core CPI figure will play a pivotal role in shaping expectations regarding the future trajectory of U.S. interest rate cuts,” said Sugandha Sachdeva, founder of SS WealthStreet, a New Delhi-based research firm.
Economists are expecting a 0.3% month-on-month rise in the core measure.
Markets are pricing in around an 80% chance of a rate cut by the Fed’s September meeting, with about 40 basis points of cuts in total expected in 2024, LSEG data showed.
Uncertainty around Indian elections has also kept investors cautious, as the comparatively low voter turnout so far has prompted worries that Prime Minister Narendra Modi’s party may not achieve the decisive victory that opinion polls had predicted.
Foreign investors took out more than $2 billion from Indian equities last week amid the election uncertainty.
However, likely intervention from the Reserve Bank of India is leading to stability in the rupee, Sachdeva said, pegging the rupee in an 83.20-83.70 zone in the coming sessions.
This article was generated from an automated news agency feed without modifications to text.
