MUMBAI, Oct 16 (Reuters) – The Indian rupee fell marginally on Wednesday, despite the rise in regional peers and lower crude oil prices, as dollar demand from foreign banks and importers weighed on the currency.
The rupee was at 84.05 against the U.S. dollar as of 11:30 a.m. IST, against its close at 84.0375 in the previous session.
Asian currencies were up between 0.1% to 0.4% ahead of closely watched central bank policy decisions in Indonesia, Thailand and Philippines.
“While this decline in oil prices offers some relief for the rupee, the bigger factor in the near term will likely be foreign institutional investor flows,” Amit Pabari, managing director at FX advisory firm CR Forex, said.
Overseas investors have pulled out nearly $8 billion from Indian stocks so far in October, the highest monthly outflow in more than 4 years.
On Wednesday, foreign banks were spotted bidding for dollars, likely on behalf of custodial clients, while importers were also active, a trader at a foreign bank said.
Investors await U.S. retail sales and jobless claims reports, due on Thursday, for cues on the future path of U.S. policy rates.
Interest rate futures have nearly priced in a 25-basis-point rate cut by the Federal Reserve in November.
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Reporting by Jaspreet Kalra; Editing by Mrigank Dhaniwala
Our Standards: The Thomson Reuters Trust Principles.
