The rupee dipped by 5 paise to 81.95 against the US dollar in early trade on Thursday, as investors preferred to remain on the sidelines ahead of the RBI policy decision.
At the interbank foreign exchange, the Rupee opened weak at 81.95 against the dollar, with a decline of 5 paise over its last close. In initial trade, the local unit also saw a high of 81.88 against the greenback.
Rupee on Wednesday
On Wednesday, the rupee gained 42 paise to close at 81.90 against the US dollar.
CR Forex Advisors MD Amit Pabari said, "Today, the RBI would release its monetary policy outcome, which will turn the eyeballs on the INR as markets have already factored in a 25-basis point rate hike by the RBI."
RBI to present Monetary Policy
The RBI's rate-setting panel on Monday started its three-day meeting amid expectations that the central bank may go for a 25 basis point hike in benchmark interest rate, probably the last in the current monetary tightening cycle that began in May 2022.
Pabari further noted that Reserve Bank Governor Shaktikanta Das-headed Monetary Policy Committee would maintain its option to hike via continuing its 'withdrawal of accommodative' stance and holding on to its tightening policy.
"However, if the RBI Governor hints at a pause in interest rates going further or he surprises with a lesser rate hike in his speech it would hurt the local unit," he said.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.16 per cent to 102.01.
Brent crude futures
Brent crude futures, the global oil benchmark, declined 0.92 per cent to USD 84.21 per barrel.
Markets on Thursday opened in red with Sensex at 59,568.14, down by 121.17 points and Nifty down by 32.20 points at 17,524.85. Titan, Kotak Bank, HCL Tech and Axis Bank were among the gainers whereas HDFC Bank, NTPC, Bharti Airtel and Maruti were among the losers.
With inputs from PTI
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