The Indian rupee closed stronger on Monday, aided by gains in most of its Asian peers and dollar sales from foreign banks, traders said.
The rupee closed at 83.4600 against the U.S. dollar, higher than its close at 83.5325 in the previous session.
Most Asian currencies gained as the dollar slipped from its near two-month high and was last quoted down 0.2% at 105.64. The Indonesian rupiah was up 0.3% and leading gains among major Asian currencies.
Dollar sales from foreign banks aided the rupee in early trading but oil companies' bids eroded some of the gains, traders said.
For the dollar-rupee pair, a fall below "83.40 should move it to 83.20, while a breach of resistance at 83.60 should push it towards 83.80," a foreign exchange trader at a large private bank said.
"It (USD/INR) may decline this week before resuming its uptrend," the trader said.
Expectations of dollar inflows as domestic bonds are to be included in a JPMorgan index are likely to push out potential weakness in the rupee, traders said.
The inclusion is expected to spur passive inflows of about $2 billion around June 28.
For USD/INR, "buy on dips around 83.20-83.10 and sell on upticks around 83.50-83.70 remains a viable strategy," Amit Pabari, managing director at FX advisory firm CR Forex said.
Investors await remarks from Federal Reserve policymakers this week for further cues on when the central bank may begin to ease policy rates.
Interest rate futures are currently pricing in a 67% chance of a rate cut in September, according to CME's FedWatch tool.
Source Name : Economic Times