Rupee opens 6 paise down at 73.67 against dollar.

The rupee on Monday opened 6 paise down at 73.67 against the US dollar following some buying in American currency by banks and importers.

The local currency rose in the first half of the previous session following recovery in domestic equities but gains remained capped as the dollar strengthened against its major crosses.

On the domestic front, the focus will be on fiscal deficit number that will be released this week and widening fiscal deficit could keep the rupee weighed down against the US dollar. Volatility for the currency is expected to remain low ahead of the important RBI policy statement that will be released this week.

There are hopes that the central bank could keep a dovish outlook on the economy. At the same time, the focus will be on the central bank’s stance on inflation and that is likely to provide a trigger to the rupee.

Motilal Oswal Financial Services NSE 1.23 % believes that USDINR (Spot) to quote in the range of 73.40 and 74.20 on Monday.

Last week, the dollar rose sharply against its major crosses after the Fed Chairman’s testimony; wherein the central bank governor said growth still remains far from where it was “and the path ahead continues to be highly uncertain. This week, volatility in the first half of the week could remain low as market participants will remain cautious ahead of the important final GDP and payrolls number that will be released in the latter half of the week.