By Nimesh Vora
MUMBAI (Reuters) – The Indian rupee ended little changed against the dollar on Tuesday even as most Asian peers gained on signs that the Chinese central bank may be wary of the yuan’s recent decline.
The rupee ended at 82.0250 to the dollar, up from 82.04 in the previous session.
“Today was once again a day where we witnessed an intraday range of about 10 paisa,” a forex trader said.
“There is nothing to take from today’s session, except that we can expect the current stalemate to continue.”
Anil Bhansali, head treasury at Finrex Treasury Advisors, concurs with this view. Bhansali expects the existing range of the rupee to continue for “some more time, with the RBI buying dollars.”
The offshore Chinese yuan recovered to 7.2248 to the U.S. dollar on dollar sales by state-run banks and the lower-than-expected USD/CNY fix.
It was likely a signal by the Chinese central bank that it reckons that the recent fall in the yuan has been too quick, analysts said.
The yuan lifted other Asian currencies and pushed the dollar index lower.
Investors will be eyeing U.S. data releases this week to gauge how many more times the U.S. Federal Reserve will raise rates. Futures indicate that investors are not convinced that the Fed will be able to follow through on its projections of two more rate hikes this year.
Rupee forward premiums inched higher during the trading session, with the one-year implied yield hitting a one-month high of 1.87%. The yield eventually ended one basis point lower at 1.84%.
(Reporting by Nimesh Vora; Editing by Sonia Cheema)
