Rupee closes flat, notches second weekly loss in a row

The Indian rupee ended flat on Friday but posted its second weekly loss in a row, pressured by a surge in U.S. Treasury yields and a stronger greenback.

The local currency posted a weekly loss of 0.23%, closing at 83.2450 against the U.S. dollar and little changed from its close of 83.25 in the previous session.

The rupee was in a narrow range for much of the day's trading session after the Reserve Bank of India's monetary policy decision did not provide any fresh cues to the currency, analysts said.

The RBI kept its key lending rate steady but signalled it would keep rates high and liquidity tight.

Earlier in the week, the 10-year U.S. Treasury yield rose to a peak of 4.88%, pressuring currencies like the rupee. But the rupee's weakness was contained as the RBI likely intervened to aid the local unit, traders said.

The 10-year U.S. Treasury yield was last quoted at 4.74%.

The dollar index was little changed at 106.29 and Asian currencies were largely steady as well. Brent crude oil futures were slightly lower at $84.04 and have fallen over 11% this week.

The rupee was also pressured by local oil companies' demand for the greenback and failed to gain despite some early weakness in the U.S. dollar index on Friday, a foreign exchange trader at a state-run bank said.

"We are on a thin edge, just need a trigger," said Arnob Biswas, head of foreign exchange research at SMC Global Securities, referring to the rupee continuing to hover close to record low levels.

The rupee hit its lifetime low of 83.29 in October 2022.

Investors will await the U.S. non-farm payrolls report and the unemployment rate due later on Friday, which could provide further cues on U.S. Federal Reserve policy.