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Rupee holds near 96 as RBI intervention seen before dollar open
USD/INR struggled to push past 95.96, while 10-year US Treasury yields neared a 19-year high of 5.23% as investors priced a higher-for-longer Fed.
The Indian rupee gained temporary ground versus the US dollar on Friday, with USD/INR failing to extend gains above 95.96, as market participants expected Reserve Bank of India intervention.
According to Reuters, India’s central bank likely sold US dollars before the local spot market opened, with traders saying the action helped the rupee stay stronger than the 96-per-dollar psychological level.
The relief, however, appeared limited as US Treasury yields continued to rise on an elevated energy price backdrop and a higher-for-longer Federal Reserve rate narrative, which weighed on demand for riskier assets like equities and EM currencies.
At the same time, 10-year US Treasury yields were near the 19-year high of 5.23% reported on Thursday, while the MCX Crude Oil contract expiring October 19 traded 2.3% lower near Rs. 8,950 after a sharp two-day move.
Latest closeWTI crude $95.27 ▲3.4%