Indian rupee nearly flat as oil companies' dollar bids counter gains in Asia FX

The offshore Chinese yuan was up slightly at 7.28 after declining to its weakest level since November on Monday

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By Reuters

Published: Tue 25 Jun 2024, 10:05 AM

Last updated: Tue 25 Jun 2024, 10:07 AM

The Indian rupee was little changed on Tuesday as month-end dollar demand from importers, including local oil companies, countered the positive cues from gains in most Asian currencies.

The rupee was at 22.73 against the UAE dirham or 83.43 against the US dollar as of 10.35am Indian Standard Time (IST), marginally changed from its previous close at 22.74 UAE dirham or 83.46 US dollar.

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Asian currencies were mostly higher, aided by a broadly weaker dollar. The offshore Chinese yuan was up slightly at 7.28 after declining to its weakest level since November on Monday.

There seemed to be "mild inflows that are getting absorbed", a foreign exchange trader at a foreign bank said. Dollar demand from local oil companies related to month-end payments also hurdled the rupee's gains, the trader added.

Crude oil futures have risen more than 5% over June so far and are hovering close to their highest levels in two months, spurred by the prospect of strong summer-driven demand and amid tensions in the Middle East.

A pullback in the Japanese yen and Chinese yuan "has eased pressure on the rupee" and the currency is likely to trade in an 83.40-83.55 range with sideways price action, FX advisory firm IFA Global said in a note.

Meanwhile, India's current account balance posted a surplus for the first time in 10 quarters in the January-March period, helped by higher service exports and private transfer receipts.

The country's balance of payments (INBOP=ECI), opens new tab was at a surplus of $30.8 billion in the March quarter, compared with a surplus of $5.6 billion a year earlier.

Investors now await remarks from Federal Reserve officials and the U.S. consumer confidence data due later in the day.

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Reuters

Published: Tue 25 Jun 2024, 10:05 AM

Last updated: Tue 25 Jun 2024, 10:07 AM

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