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Updated January 1st, 2024 at 15:51 IST

Rupee end marginally lower after muted trading on a lack of fresh triggers

Rupee on Monday closed marginally lower following muted trading on a lack of fresh triggers at the start of the year.

Business Desk
Rupee versus Dollar
Rupee versus Dollar | Image:Unsplash

Rupee on Monday closed marginally lower following muted trading on a lack of fresh triggers at the start of the year.

The rupee ended at Rs 83.2375 against the US dollar, slightly lower from its close at Rs 83.2075 in the previous session.

Most global markets were shut on Monday on account of the New Year's holiday.

While the rupee notched some gains early in the session, dollar buying from state-run banks weighed on the unit, a foreign exchange trader at a private bank said.

Trading volumes were relatively lighter, the trader said.

The dollar index notched its second consecutive monthly loss in December and fell about 2 per cent amid growing expectations the Federal Reserve may begin easing rates soon.

For the year gone by, the dollar index fell 2 per cent as well, marking its first annual loss since 2020.

Market participants are currently pricing in a very high probability the Fed will cut rates at its March meeting.

While this has sparked gains in most Asian currencies, the rupee has been a laggard amid strong local dollar demand and on likely absorption of inflows by the Reserve Bank of India, traders said.

In the near-term, the rupee "appears to be stuck," in its prevailing range with strong hurdles at 83 and 83.50, said Dilip Parmar, a foreign exchange research analyst at HDFC Securities.

Meanwhile, India's benchmark equity indexes Nifty 50 and Sensex hit record highs in the first session of 2024.

Investors now await key US economic data later this week including non-farm payroll and unemployment data due on Friday.

Published January 1st, 2024 at 15:46 IST

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