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The Indian rupee is likely to hold near its all-time low at the open on Friday after robust U.S. data reinforced the view that the Federal Reserve will cut interest rates at a measured pace next year.

The one-month non-deliverable forward indicated that the rupee will open at 85.06-85.08 to the U.S. dollar, near its lifetime low of 85.0850 hit on Thursday.

The dollar index and U.S. yields extended their post-Fed rally on Thursday. The 10-year U.S. yield hit nearly 4.60%, the highest in more than six months, while the dollar index scaled a two-year peak.

Data released on Thursday showed that U.S. third-quarter GDP grew at faster clip than expected and jobless claims declined more than anticipated.

The data, which indicated that the economy is in good shape and the labour market is holding up, came a day after the Fed signalled fewer rate cuts in 2025 amid sticky inflation.

"The U.S. data just basically provided one more reason to buy the dollar, if one was needed," a currency trader at a bank said.

The rupee "just can't avoid" the impact of what is happening in the overall emerging market (EM) currencies space, and "honestly, it is good that it does not", he said.

Investors dumped EM currencies on Thursday on worries that U.S. rates are likely to remain higher for longer, prompting their central banks to take steps to defend their currency.

US INFLATION DATA ON TAP

Core U.S. PCE data, due later on Friday, will provide cues on how inflation is shaping up.

"With the Fed injecting some concern of inflation risk into the mix, the outcome of the U.S. core PCE print does have the potential to impact the USD," Chris Weston, head of research at Pepperstone, said.

KEY INDICATORS:

** One-month non-deliverable rupee forward at 85.26; onshore one-month forward premium at 18.5 paise

** Dollar index at 108.44

** Brent crude futures down 0.5% at $72.5 per barrel

** Ten-year U.S. note yield at 4.56%

** As per NSDL data, foreign investors sold a net $108.6 million worth of Indian shares on Dec. 18

** NSDL data shows foreign investors sold a net $157 million worth of Indian bonds on Dec. 18