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Rupee Dips as US Fed Rate Cut Looms
10 Dec
Summary
- Indian rupee closed at 89.96, a slight decrease against the US dollar.
- Market sentiment is cautious awaiting the US Federal Reserve's expected rate cut.
- Bilateral trade talks with the US may offer positive support to the rupee.
The Indian rupee closed at 89.96, marking a slight depreciation against the US dollar. The currency traded within a narrow range throughout the day, with traders adopting a cautious approach. This sentiment is largely driven by anticipation of the US Federal Reserve's monetary policy decision, expected later today.
Market focus has firmly shifted to the Federal Reserve's meeting, which is poised to be the last of 2025. Analysts predict a quarter-point rate cut, influenced by cooling labor market data and rising layoffs in the US economy. The commentary from Fed Chair Jerome Powell on future policy will be crucial for the dollar's movement and, consequently, the rupee's direction.
Adding a potential layer of support for the Indian currency are ongoing bilateral trade talks with a US delegation. Progress in these discussions towards a trade agreement could offer relief to the rupee. The market is closely monitoring these developments alongside the crucial US economic indicators.
