On Friday, the Indian rupee hit a new lifetime low of 83.3050 against the US dollar, reacting to the overall weakness observed in Asian currencies. The decline followed a hawkish statement from US Federal Chair Jerome Powell on Thursday, where he emphasized the central bank's readiness to raise interest rates if required to meet its 2% inflation target. Powell's remarks triggered an uptick in US bond yields, with the 2-year yield reaching 5.04%, and the dollar index nearly touching 106 against a basket of six major currencies.
The previous lifetime low for the rupee stood at 83.2950, and as of Thursday's close, the domestic currency was recorded at 83.2800. Anil Kumar Bhansali, Head of Treasury and Executive Director at Finrex Treasury Advisors LLP, anticipates the INR to trade within a narrow range of 83.20 to 83.35, with the Reserve Bank of India (RBI) working to limit the depreciation of the local currency.
Bhansali noted that investors will closely monitor US consumer confidence data for November. Additionally, after Powell's hawkish stance, the US 10-year treasury experienced an increase, reaching 4.6190%.