MUMBAI, July 25 (Reuters) – The Indian rupee is expected to decline to a lifetime low at open on Thursday on weak risk appetite and a drop in Asian peers.
Non-deliverable forwards indicate the rupee will open at 83.74-83.75 to the U.S. dollar, slipping past the previous all-time low of 83.72 and compared with 83.7175 on Wednesday.
It would be the fourth day in a row that the local currency has hit a low. The Reserve Bank of India has intervened regularly to support the rupee, capping its decline.
The rupee is down just 0.2% this week.
“While we keep making fresh highs (on dollar/rupee), there is no way you can think of a breakout,” a currency trader at a banks. “The RBI is doing what it does, and managing the extent of price moves.”
ASIA FX STRUGGLES
The risk-off mood in markets has continued amid US election uncertainty, technology earnings disappointment, and signs of softness in world growth, MUFG Bank said in a note.
The risk aversion prompted a rally on the Japanese yen. U.S. Treasury yields dipped in Asia after inching up on Wednesday.
KEY INDICATORS: ** One-month non-deliverable rupee forward at 83.82; onshore one-month forward premium at 7 paise ** Dollar index down at 104.26 ** Brent crude futures down 0.8% at $81.1 per barrel ** Ten-year U.S. note yield at 4.26% ** As per NSDL data, foreign investors sold a net $185.1mln worth of Indian shares on Jul. 23
** NSDL data shows foreign investors bought a net $294.6mln worth of Indian bonds on Jul. 23
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