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Rupee Outlook and Strategy

* The US dollar declined 0.37% yesterday amid rise in risk appetite in global markets. Market sentiments improved on relaxation of some Covid-19 restrictions in China and as Chinese government led down plan for accelerating economic recovery. Additionally, dollar slipped on bets that US Federal Reserve will tighten policy at slower pace

* Rupee future maturing on June 28 appreciated by 0.07% amid weak dollar and rise in risk appetite in global markets. Meanwhile, surge in crude oil prices prevented further gains

* The rupee is expected to appreciate today amid weakness in dollar and optimistic global market sentiments. Further, investors cut back bets on aggressive monetary tightening. Now they anticipate that US Fed might slow its tightening cycle and assess the effects of policy firming. However, sharp gains may be prevented on elevated crude oil prices. Additionally, investors will remain vigilant ahead of GDP data, which is likely to show that economic growth slowed down in Q4FY22. US$INR (June) is expected to trade in a range of 77.70-78.00.

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