sb.scorecardresearch

Delhi Election Result 2025 in association with

Camlin

Published 10:43 IST, July 11th 2024

Rupee trades flat, volatility expectations drop to 4-month low

Recent sessions have seen the Rupee exhibiting mostly rangebound behavior, contributing to a decrease in volatility expectations.

Reported by: Business Desk
Follow: Google News Icon
  • share
rupee and dollar
Rupee Vs. Dollar | Image: Unsplash

Rupee vs Dollar: The Indian Rupee remained largely unchanged on Thursday, showing minimal movement compared to its Asian counterparts, which saw gains spurred by a decline in US bond yields.

At 10:20 am, the Rupee (INR=IN) traded at 83.5025 against the US Dollar, barely different from its previous close at 83.52. Early trading witnessed the currency trading within a narrow band of 83.50-83.51.

Recent sessions have seen the Rupee exhibiting mostly rangebound behavior, contributing to a decrease in volatility expectations. The 1-month implied volatility dropped to 1.65 per cent, marking its lowest level since March 7.

Meanwhile, the Dollar index fell below 105, with most Asian currencies strengthening. The Korean won led the gains, rising by 0.3 per cent, ahead of the closely watched US inflation data scheduled for later in the day.

Market participants anticipate that this data will influence expectations regarding the Federal Reserve's monetary policy direction. According to CME's FedWatch tool, interest rate futures currently indicate a 73 per cent likelihood of a rate cut in September.

Lloyd Chan, a senior currency analyst at MUFG Bank, commented, "We currently see a two-way risk to US inflation, with tighter monetary conditions and a softer labor market potentially reducing inflation, while geopolitical tensions pose upside risks."

Economists surveyed by Reuters expect the core US Consumer Price Index (CPI) to remain unchanged month-on-month at 0.2 per cent for June.

Traders predict the Rupee to fluctuate between 83.45 and 83.55 during today's trading session, with routine importer Dollar demand potentially limiting gains for the currency.

Apart from the US inflation data, investors will closely monitor speeches from Federal Reserve officials scheduled later in the day.

(With Reuters inputs.)

Updated 10:43 IST, July 11th 2024