Indian Rupee notes are seen in this picture illustration taken in Mumbai . The government may unveil measures on Wednesday or Thursday to boost capital inflows into the country, as the rupee hovers around record-low levels, a source familiar with the development said.
Uday Kotak, founder and non-executive director of Kotak Mahindra Bank; Isha Ambani, non-executive director of Jio Platforms Ltd.; Akash Ambani, chairman of Reliance Jio Infocomm Ltd. and director of Reliance Retail Ventures Ltd.; and Pankaj Pawar, chief executive officer of Jio Platforms Ltd., pose for a picture during a Jio Platforms Ltd. IPO press conference in Mumbai, India,
Traffic moves past Jio advertisement boards ahead of the Jio Platforms IPO listing ceremony in Mumbai, India
MUMBAI, Oct 22 (Reuters) – The Indian rupee is likely to open flat on Thursday, with traders looking to Jio Platforms IPO flows and positioning for direction while oil prices remain a risk. The rupee is expected to open in 94.44-94.50 range, per traders, after settling at 94.46 to the dollar on Wednesday. The currency is on an eight-session winning streak, climbing from around 96.60-96.70. A series of measures by the Reserve Bank of India coupled with active intervention and flows related to the Jio Platforms IPO on Wednesday have lifted the currency to its highest level since the first week of September.The unwinding of positions, particularly in the non-deliverable forward market, has further fuelled the rupee’s rally, traders said.
The rupee on Wednesday broke past the 94.70 level, which had acted as a key technical hurdle throughout last week. The break could prompt further unwinding of long-dollar positions, a treasury official at a bank said.
While the currency’s current levels offer importers an attractive opportunity to buy dollars amid high oil prices, expectations of continued RBI intervention and supportive flows over the next two to three days could make them cautious about rushing in, he said.The Jio Platforms IPO saw strong demand on its opening day on Wednesday, led by institutional investors. While foreign investors can use sell/buy FX swaps to manage IPO-related flows without directly affecting spot-market dollar supply, some of these flows do filter through to the spot market, bankers said.
OIL PRICE PRESSURES
Oil prices rose on Thursday with more attacks by the Houthis in Saudi Arabia prompting the United States to order diplomats and family members to leave its missions in the Kingdom. Brent crude rose 1.5% to inch past $110.50.
Oil remains a key threat to the rupee’s recovery, and there is “material” risk of the currency reversing its ongoing rally, the treasury official said.
Reporting by Nimesh Vora; Editing by Harikrishnan Nair
