Dollar vs. Rupee: The Indian rupee is expected to fall in value on Wednesday amid a stronger dollar and expectations of a rate hike by the Fed during today’s monetary policy meeting. However, easing in crude oil prices will continue to support the rupee.

The Indian rupee is expected to depreciate on Wednesday amid a stronger dollar and expectations of a rate hike by the Fed at today’s monetary policy meeting. However, easing in crude oil prices will continue to support the rupee. In addition, investors will be watching a range of macroeconomic data out of the US. “The rupee (March) is likely to fall in value for a day to 77.0,” said ICICI Direct. In the previous session, the rupee closed slightly lower against the US dollar. In the interbank currency market, the local unit rupee opened strongly against the dollar at 76.40. Over the course of the day, it moved between 76.32 and 76.68 before settling at 76.60 against the dollar, down 6 paise from its previous close.

Heena Naik, Research Analyst – Currency, Angel One Ltd

On March 15, 2022, the Indian rupee weakened to 76.68 levels due to opportunistic dollar purchases by most oil companies. In the session ahead, the local unit is likely to trade in a bandwidth-bound fashion with a negative bias towards the 76.80 levels as investors indulge in speculation ahead of the release of US Fed policy. In addition, there was news of the suspension of Russia’s Yamal gas pipeline, which could further disrupt supply. Russians had previously warned of this escalation in response to EU sanctions on Russian Oil. Despite this, European Union officials have claimed that they will continue to import Russian gas even after sanctions.”

Tapish Pandey, Research Analyst, SMC Global Securities Ltd

“The Indian rupee is likely to trade with mixed feelings ahead of a close meeting of the US Federal Reserve, while oil prices remained volatile as participants weighed in on the outcome of the Ukraine peace talks. On the domestic front, Foreign Institutional Investors (FII) again took out Rs 1,249.74 crores from Indian markets, suggesting that weakness for the rupee is likely to continue. Dollar rupee near month future is trading in a broader range of 76.21 to 76.85 levels from the last few trading sessions which will act as immediate support and resistance respectively.

“If USDINR manages to break above said range (76.21-76.85), it could move higher towards its key resistance zone near record high levels of 77.30-77.33. Overall trading setup indicating a sideways to bullish trend for the dollar rupee, we expect USDINR to witness a volatile trading session in the broader range. Any dip towards a support zone can be used as a trading opportunity by holding stop loss below 76.

Anindya Banerjee, DVP, Currency Derivatives and Interest Rate Derivatives at Kotak Securities Ltd

“USDINR spot closed flat despite a heavy sell-off in stock markets. Spot closed at 76.60. Selling in Chinese technology stocks and real estate stocks sparked the global sell-off. USDINR may remain in range between 76.30-76.90 at the US Fed meeting on Wednesday night.”

Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services

“The rupee consolidated within a narrow range but fell in the second half of the session ahead of the important FOMC policy statement to be released today. It is expected that the central bank could try to raise interest rates and also provide forecasts for growth and inflation that could cause dollar volatility. Volatility for the dollar remained low even after Russia put US President Joe Biden, Canadian Prime Minister Justin Trudeau and a dozen top US officials on a “stop list” barring them from entering the country. Aside from the Federal Reserve’s policy meeting, market participants will also be eyeing the Bank of England’s policy statement, which is likely to impact the pound, which has weighed heavily against the US dollar over the past few sessions. We expect the USDINR(Spot) to trade sideways, trading between 76.20 and 76.80.”

This post The rupee may fall in value amid a strong dollar and expectations for a rate hike by the US Fed; USDINR pair to trade in this range

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