The Indian Rupee was trading marginally higher against the US dollar on Tuesday due to muted dollar demand by exporters and banks, while optimism over interest rate cut by the Reserve Bank boosted by the local currency. Global ratings agency Fitch has said that there is room for rate cut by the Reserve Bank of India, but at the same time it has lowered India’s growth forecast for FY’19 to 7.3 per cent from 7.4 per cent earlier.
The RBI’s Monetary Policy Committee (MPC) will start its two-day policy meeting today to announce its stance on interest rates. At the Interbank Foreign Exchange Market, the local currency was trading 1 paise higher at 64.54 per dollar against a previous close of 64.55 per dollar.
During the day’s trade so far, the rupee touched an intra-day high of 64.39 after opening at 64.48. However, weakness in the domestic equity market dented sentiment at local forex market. The 30-share benchmark index was trading at 32740.81, down by 128.91 points or by 0.39 per cent, and the NSE Nifty was at 10091.05, down by 36.7 points or by 0.36 per cent.