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 Healthy macro-economic industrial output, as well as, accelerated nationwide vaccination drive are expected to strengthen the Indian rupee in the coming week.

Accordingly, healthy macros are likely to attract foreign capitals to the equity markets on the prospects of faster economic growth.

However, the trend might be arrested on account of announcements related to tapering measures.

Experts opine that these announcements might drive away FIIs from India to more lucrative markets in the developed economies.

Lately, healthy FII inflows have perked-up India's stock markets and the rupee.

"Rupee is expected take cues from global markets and tapering news buildup," said Sajal Gupta, Head, Forex and Rates at Edelweiss Securities.

"Domestic IIP and growth numbers were encouraging. Vaccination too is at a rapid pace. Dull IPO market during the last few weeks has slowed inflows a bit."

On a weekly basis, Rupee previously closed at 73.50 to a greenback.

"After a small bout of short-covering in the dollar last week, we expect the greenback to head lower this week. Weaker than expected softer economic numbers like jobs reports will entail that fed will be slower than earlier expected in tapering," said Devarsh Vakil, Deputy Head of Retail Research, HDFC Securities.

"Strong economic growth numbers coming out of India, robust tax collections, and stimulus provided to exporters will help Rupee to strengthen in the coming week."

Furthermore, Vakil expects the rupee to remain in a narrow range of 72.9 to 74 in the upcoming week with a bias towards appreciation.

According to Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services: "Next week, on the domestic front, inflation numbers will be released and expectation is that the price could be sharper as compared to the previous month."

"Market participants will also be keeping an eye on the fund flow activity as it will be important to determine trend for the currency. At the same time, from the US, inflation, industrial production and retail sales number will be important to watch."

In addition, he cited that volatility in the US dollar has increased in the recent past and these economic numbers will provide further clarity on the state of the economy.