Image Courtesy: The Financial Express
The rupee was steady in early trade on Tuesday after rebounding strongly in the previous session when it paused a two-day losing streak.
According to Bloomberg, the rupee recently traded at 82.6788 to the dollar, down from Monday’s finish of 82.7025.
The currency made modest gains in the previous session as the dollar dropped, breaking a two-session losing skid. Additionally, expectations of a recovery in China’s demand helped to the mood to some extent.
However, investors also largely anticipate some bumps along the way for China’s relaxation of COVID restrictions and the potential for a higher-than-expected rise in US interest rates in 2023.
The US Treasury yields rose on Tuesday, helping the dollar move toward a one-week high against a basket of key currencies as investors continued to digest the Federal Reserve’s message of higher for longer interest rates.
According to National Australia Bank Strategist Rodrigo Catril, the “hawkish Fed policy update remains fresh in the minds of investors,” boosting US rates and the currency, according to Reuters.
In addition, he said that amid declining market liquidity as we approach the holiday season, “consolidation is the theme within FX.”
Ahead of a Bank of Japan (BOJ) policy decision, the yen dropped versus the dollar on Tuesday.
In response to media speculation that the government could revisit a joint statement with the BOJ that commits the bank to attaining its 2% inflation target as soon as feasible in the upcoming year, the Japanese yen briefly rose on Monday.
