MUMBAI: The rupee appreciated by 12 paise to 65.47 against the US dollar in early trade on Tuesday in line with the strength seen across Asian currency markets.
The domestic currency had plunged 32 paise against the US dollar to hit a one-month low of 65.59 in the previous session amid fresh dollar demand by banks and importers.
Experts expect the domestic currency to trade in a range throughout this week ahead of the US non-farm payroll data scheduled to be released on Friday.
“The rupee will trade on a cautious note (65.30-65.55/USD) this week. The domestic currency is exhibiting gradual weakness as the initial euphoria around debt inflows has waned and the US Fed is sounding more hawkish. The Fed has released an updated model on the US economy which indicates closing of resource slack by Q1 of 2016. The output gap is almost closed and inflation should inch up as the economy grows. Separately, the monetary policy action by the People’s Bank of China and dovish rhetoric by the European Central Bank have failed to galvanise the risk-on sentiment as the economic weakness persists,” India Ratings said in a note.
