The Indian rupee appreciated by nine paise at market close on Wednesday, with easing inflation, a sliding dollar index and lower oil prices lending support.
The local unit closed at 85.68 against the US dollar, extending its slip below the psychological level of 86 for the second session. The rupee had opened at 85.61.
“Exporters are expected to wait for appropriate levels to do further hedging, while importers can keep converting their payables in cash while waiting for 85/85.25 levels to hedge,” said Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP.
Due to recent economic data pointing to waning signs, India’s industrial production growth slowed to 2.9% in February—the weakest in six months—falling short of the 4% market estimate. This signals a loss in domestic economic momentum, according to Amit Pabari, managing director at CR Forex Advisors.
