By Jaspreet Kalra
MUMBAI (Reuters) – The Indian rupee was largely steady on Wednesday even as most Asian currencies trended lower after investors solidified bets that the U.S. Federal Reserve is unlikely to cut policy rates at its March meeting.
The rupee was at 83.09 against the U.S. dollar as of 11:20 a.m. IST, barely changed from its close of 83.1050 in the previous session.
The dollar index was up 0.1% at 103.59 while most Asian currencies fell, with the Korean won leading losses.
Job openings in the United States unexpectedly rose in December and data for the prior month was also revised higher, signalling strength in the country’s labour market and lowering the odds of aggressive Fed rate cuts.
Investors are currently pricing in a nearly 44% chance of a rate cut at the Fed’s March meeting, down from about 73% at the end of December.
Resilient U.S. economic data has aided the greenback over January with the dollar index up 2.1% in the month so far and on course to log its largest monthly gain since September.
While the rupee’s rise above the 83.10 handle could open room for a move towards 83.05, don’t expect it to rise much beyond that, a foreign exchange trader at a private bank said.
The rupee has hovered in a narrow range between 83.0575 and 83.18 over the last two weeks.
While the Fed is widely expected to keep rates unchanged in its policy decision due later in the day, investors will pay close attention to remarks from Chair Jerome Powell, which could offer cues on the timing of future rate cuts.
“Chances of a dovish statement could lead to a fall in (the dollar index) and may help the rupee move towards 83-82.95,” Amit Pabari, managing director at FX advisory firm CR Forex said.
(Reporting by Jaspreet Kalra; Editing by Janane Venkatraman)