Expect Rupee to appreciate today - IIFL

Dollar/rupee extended fall from two-week low in opening trades Wednesday in anticipation of inflows after the government relaxed foreign direct investment norms in several sectors including in defense and insurance a day after the Reserve Bank of India hiked some lending rates and tightened liquidity to support the local currency.

We expect rupee to appreciate today as government's move to relax FDI reforms in various sectors lifted the sentiment and there could be some improvement in dollar inflows particularly in insurance sector.

Dollar/rupee may trade above Rs 59/$1 Wednesday on caution ahead of Federal Reserve Chairman Ben Bernanke's testimony to the Congress offsetting sentiments after Indian government relaxed overseas holding norms in several sectors including insurance and defence boosting which could attract inflows.

Source : Equity Bulls

Keywords