The Indian rupee ended nearly unchanged on Wednesday as dollar demand from importers and foreign banks offset early gains driven by growing expectations of Federal Reserve interest rate cuts. The rupee closed at 83.9475 against the US dollar, compared to the previous close of 83.97. While the currency touched a high of 83.9025 during the session, it succumbed to pressure from dollar bids. The dollar index declined 0.1 per cent to 102.4, supported by softer-than-expected US wholesale inflation data. This boosted Asian currencies, with the Indonesian rupiah leading gains. However, the upcoming US retail inflation data, due later in the day, will be crucial in determining the extent of potential Fed rate cuts. Investors are currently pricing in approximately 107 basis points of cuts for 2024. A foreign exchange trader suggested that the rupee is likely to remain within the 83.85-83.97 range unless there is significant inflow. Dollar-rupee forward premiums surged, with the one-year implied yield reaching a 15-month peak of 2.10 per cent, up 6 basis points from the previous session. Attribution: Reuters Subediting: Y.Yasser
