Mumbai: The Indian rupee on Wednesday closed higher against the US dollar ahead of the Reserve Bank of India’s (RBI) bi-monthly policy on Thursday.
The rupee closed at 64.88, up 0.22% from its Monday’s close of 65.03. The rupee opened at 65.08 a dollar and touched a high and a low of 64.91 and 65.88 respectively. Markets were closed on Tuesday on account of Ram Navmi.
According to a Mint poll, RBI is likely to hold rates and retain its neutral stance in the policy.
“The main focus of the central bank is likely to be on liquidity absorption in order to signal a neutral policy approach and for gaining additional headroom to intervene in the currency market”, said Abheek Barua, Chief Economist, HDFC Bank.
Traders are also eying key US payrolls report on Friday and minutes from the US Federal Reserve’s March meeting on Wednesday.
So far this year, foreign institutional investors have bought $6.70 billion and $4.40 billion from local equity and debt markets, respectively.
The 10-year bond yield closed at 6.651%, unchanged from its previous close of 6.651%. Bond yields and prices move in opposite directions.
The benchmark Sensex index rose 0.21% or 64.02 points to closed at 29,974.24. So far this year, it has risen 12.57%.
Asian currencies were trading higher. Taiwan dollar was up 0.35%, Japanese yen 0.06%, Singapore dollar 0.06%, Japanese yen 0.05% and Indonesian rupiah 0.04%. However, Thai baht was down 0.21% and South Korean won 0.11%.
The dollar index, which measures the US currency’s strength against major currencies, was trading at 100.51, down 0.03% from its previous close of 100.54
