Rupee dips less than peers on support at 81.80-81.85/USD
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The Indian rupee was marginally weaker against the U.S. currency on Monday, but did well relative to other Asian currencies, thanks to a near-term support level, traders said.
The rupee was trading at 81.71 per U.S. dollar by 0500 GMT, a tad weaker than 81.6850 in the previous session. The local unit had fallen to 81.8325 earlier in the session.
It's the same as last week when, multiple times, the pair (USD/INR) was unable to move above 81.90, a trader at a private sector bank said.
It is "difficult to pin down exactly" what is leading to the dollar offers above 81.80, the trader said.
The rupee's Asian counterparts were broadly weaker, weighed by concerns over China. The offshore Chinese yuan declined to the dollar and Chinese equities fell on worries about the protests against strict COVID-19 curbs in the world's second-largest economy.
The dollar index rose on weak risk appetite. Treasury yields nudged lower and oil prices fell.
The fall in Brent crude prices to its lowest level since January is likely helping the rupee outperform other Asian currencies, according to traders. Brent crude, already on a three-week losing streak, was down about 2.7% at $81.32.
Rupee forward premiums fell, with the 1-year implied yield below 2% for the first time in over a decade. Cash dollar demand that pushed the overnight cash/swap rate to 0.35 paise is prompting market participants to lower their bid on premiums, said the trader quote above.
