Traders said demand for US dollars from importers and oil companies kept the rupee under pressure, while expectations of a US Fed rate hike later in the day prevented the local unit from appreciating despite a record foreign-currency haul that has boosted Mint Road’s forex stockpile.
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The rupee traded in the range of 95.84 and 95.98 on Wednesday, with the RBI likely selling dollars at weaker levels, dealers said. Market participants expect the rupee to weaken past the 96 level if there is a rate hike by the US Fed or if the Fed chair gives a hawkish commentary.
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Rupee is expected to trade between 95.75 and 96.25 on Thursday. “I expect the rupee to remain under 96 for some time unless oil prices rise above $110 per barrel and the dollar index crosses 100,” said Anil Bhansali, head of treasury, Finrex Treasury Advisors.
