UAE: Indian rupee inches up against dirham in early trade

The South Asian currency is set for a quiet session today, eyeing whether the US Federal Reserve will signal fewer rate cuts this year

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Web Desk

Published: Wed 20 Mar 2024, 9:45 AM

The Indian rupee edged up 1 paisa to 83.02 against the US dollar (22.62 against UAE dirham) on Wednesday ahead of the announcement of the key US Fed policy decision later in the day.

At the interbank foreign exchange market, the South Asian currency opened higher at 83 (22.62 against UAE dirham) compared to the previous close of 83.03 in line with firm stock markets.

The rupee traded at 83.02, up 1 paisa, in early morning deals.

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The currency is set for a quiet session today, eyeing whether the US Federal Reserve will signal fewer rate cuts this year, compared to its December projections.

The Fed is not expected to make changes to the policy rate, with the primary focus on projections on the interest rate trajectory. In December, the median estimate for Dec 2024 was 4.6 per cent, signalling expectations for three 25 basis points rate cuts.

The median was centred on forecast of only six members, a slim majority of one, ANZ Bank said in a note. Five members predicted two rate cuts and four predicted four cuts.

"The tight clustering leaves potential for the median dot plot to shift to signalling two cuts this year," ANZ said.

Expectations for rate cuts have changed significantly since the beginning of the year, with investors now pricing in fewer cuts compared to the initial projections of more than six.

(With inputs from PTI, Reuters)

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Web Desk

Published: Wed 20 Mar 2024, 9:45 AM

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