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NIFTY 100 23,443.10 up stock 111.70 (0.48%)
NIFTY 500 20,773.65 up stock 162.25 (0.79%)
NIFTY MIDCAP 50 14,184.70 up stock 187.95 (1.34%)
INDIA VIX 15.47 Down stock -0.20 (-1.22%)
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NIFTY SMALLCAP 50 7,488.00 up stock 142.00 (1.93%)
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NIFTY AUTO 21,845.25 up stock 26.35 (0.12%)
NIFTY FMCG 52,525.45 up stock 44.95 (0.09%)
NIFTY IT 41,314.50 Down stock -149.85 (-0.36%)
NIFTY MEDIA 1,503.85 up stock 31.20 (2.12%)
NIFTY METAL 8,367.45 up stock 111.85 (1.35%)
NIFTY PHARMA 20,812.10 Down stock -157.10 (-0.75%)
NIFTY PRIVATE BANK 24,774.45 up stock 273.85 (1.12%)
NIFTY REALTY 855.70 up stock 23.65 (2.84%)
NIFTY OIL & GAS 10,035.65 up stock 63.60 (0.64%)
NIFTY COMMODITIES 7,853.75 up stock 71.90 (0.92%)
NIFTY ENERGY 31,189.80 up stock 340.75 (1.10%)
LEADMINI 188 up stock 0.20 (0.11%)
ZINCMINI 261.25 up stock 0.25 (0.1%)
SILVERMIC 89730 up stock 72.00 (0.08%)
GOLDGUINEA 59188 up stock 50.00 (0.08%)
GOLDM 72900 up stock 28.00 (0.04%)
COTTONCNDY 56540 up stock 20.00 (0.04%)
SILVER 89675 up stock 29.00 (0.03%)
CRUDEOIL 6609 Down stock -237.00 (-3.46%)
NATURALGAS 177.5 Down stock -0.30 (-0.17%)
NATGASMINI 177.5 Down stock -0.30 (-0.17%)
MENTHAOIL 942.2 Down stock -1.20 (-0.13%)
ZINC 260.7 Down stock -0.25 (-0.1%)
ALUMINIUM 220.5 Down stock -0.20 (-0.09%)
LEAD 187 Down stock -0.10 (-0.05%)

Updated 11:15 IST, January 30th 2025

Pressure On Rupee To Linger After Fed Signals No Hurry To Cut Rates

The 1-month non-deliverable forward indicated that the rupee will open around 86.57-86.58 to the U.S. dollar, marginally weaker than Wednesday's 86.54.

Reported by: Thomson Reuters
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Pressure on rupee to linger after Fed signals no hurry to cut rates | Image: Unsplash

The Indian rupee is likely to stay on the defensive on Thursday, January 30, after the U.S. Federal Reserve expectedly kept interest rates unchanged and Chair Jerome Powell said there would be no rush to cut them again.

Rupee Rate

The 1-month non-deliverable forward indicated that the rupee will open around 86.57-86.58 to the U.S. dollar, marginally weaker than Wednesday's 86.54.

The dollar index (.DXY), opens new tab climbed a near one-week high following the Fed's decision before paring gains to trade flat at 107.8 in Asia trading.

Referring to the potential impact of policy changes by U.S. President Donald Trump , Powell said that Fed officials are "waiting to see what policies are enacted" before judging the effects on inflation, employment and overall economic activity.

Analysts have said that Trump's policies surrounding import tariffs, an immigration crackdown, tax cuts and looser regulation may add to inflationary pressures in the U.S. economy, prompting the Fed to keep rates higher for longer.

In the near-term, investors will also keep an eye on whether Trump follows through, opens new tab on his pledge to impose 25% tariffs on Mexico and Canada from Saturday.

"Tariffs and not rate differentials are the major FX driver now. But a slightly hawkish Fed can only help a market currently positioned overweight the dollar," ING Bank said in a note.

Meanwhile, persistent portfolio outflows are also expected to keep the rupee under pressure, with foreign investors pulling out nearly $9 billion from local stocks and bonds in January so far.

Traders reckon the Reserve Bank of India's market interventions should keep a lid on the rupee's volatility.

State-run banks, likely on behalf of the RBI , "have been active near 86.60 and that is likely to continue," a trader at a state-run bank said. The rupee has weakened over 1% in January so far and is the worst performer among major Asian currencies.

Key Indicators

** One-month non-deliverable rupee forward at 86.75; onshore one-month forward premium at 17 paise

** Dollar index at 107.83
** Brent crude futures up 0 per cent at $76.6 per barrel
** Ten-year U.S. note yield at 4.53 per cent
** As per NSDL data, foreign investors sold a net $339.8mln worth of Indian shares on Jan. 28
** NSDL data shows foreign investors bought a net $113.9mln worth of Indian bonds on Jan. 28
 

 

 

 

Published 10:41 IST, January 30th 2025