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Indian Rupee Trades in Narrow Range, Await Fresh Cues

Early on Friday, the Indian rupee showed little change, trading inside a limited range as traders anticipated new clues.

The Indian rupee exhibited minimal movement early on Friday, trading within a narrow range as traders awaited fresh cues to drive momentum in the local currency.

As of 10:45 am IST (9:15 am UAE time), the rupee stood at 83.3575 against the U.S. dollar (23.15 dirhams), showing marginal variation from its previous close at 83.3475 (23.15 dirhams). 

The currency remained within the range of 83.3450 to 83.3650 in the session.

Asian Currency Trends and Dollar Index Stability:

Asian currencies, including the Korean won and Thai baht, experienced slight declines, while the dollar index remained steady at 103.7. Global markets maintained a subdued tone following the Thanksgiving holiday in the United States.

Traders anticipate the rupee to persist within a range of 5 to 6 paisa throughout the day, with limited potential for significant fluctuations.

Factors Influencing Rupee Movements:

While initial public offering (IPO)-related inflows supported the rupee earlier in the week, sustained demand for the dollar from local companies has exerted pressure on the local unit. 

This week saw maiden share sales worth $900 million in the domestic market.

Investors are closely monitoring U.S. inflation data scheduled for release next Thursday. 

October’s core personal consumption expenditure (PCE) inflation is anticipated to ease to 0.2 percent month-on-month from September’s 0.3 percent.

Federal Reserve Policy Speculations:

A lower-than-expected inflation reading could solidify expectations that the Federal Reserve will refrain from further policy rate tightening. 

Current investor sentiment includes pricing in the possibility of Fed rate cuts in May or June.

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