Rupee ducks risk-aversion pressure on Asian peers to end flat
Follow us Now on Telegram ! Get daily 10 - 12 important updates on Business, Finance and Investment. Join our Telegram Channel
The Indian rupee ended little changed on Monday, as dollar sales by foreign banks offset the drag from Asian peers that fell due to weak risk appetite as investors awaited clarity on the size of a likely U.S. rate cut this month.
The rupee ended the session at 83.9550 against the U.S. dollar, nearly unchanged from its close at 83.9475 on Friday.
Mild dollar sales from foreign banks supported the local currency, while overall trading activity was relatively subdued, a senior trader at a foreign bank said.
Routine interventions by the Reserve Bank of India (RBI) to hold the rupee above the 84 mark have also made traders wary of wagering on further weakness in the currency.
Concerns over the U.S. growth outlook, following a mixed jobs report on Friday, weighed on Asian currencies, which declined 0.1% to 0.9%.
The dollar index was up 0.3% at 101.5.
The jobs report showed that while the U.S. economy created fewer than expected jobs in August, the unemployment rate dipped to 4.2%.
Attention has turned to the U.S. Presidential debate on Sept. 10, which "could lead to increased sensitivity to polling shifts afterward", Charu Chanana, head of FX strategy for Saxo, said in a note.
"Neither of the candidates' policy plans are likely to hint at moves to rein in the ballooning fiscal deficit, and this could be marginally USD-positive," Chanana said.
Focus this week will also be on the U.S. consumer inflation print due on Wednesday.
The data is expected to shape investors' bets on whether the Fed will cut rates by 25 or 50 basis points next week.
