The rupee appreciated by 25 paisas (0.09%), closing at Rs. 281.20 against the U.S. dollar. On Monday, the local currency had settled at Rs. 281.45.
Internationally, the U.S. dollar came under pressure in early Asian trade on Tuesday, as investors analyzed comments from Federal Reserve officials regarding the future of interest rates.
The greenback weakened further after snapping a three-day winning streak on Monday, with the U.S. Dollar Index last recorded at 97.28.
Investors are closely monitoring the global economic impact of U.S. President Donald Trump’s economic policies and their potential influence on the Fed’s monetary stance, while awaiting the release of core personal consumption expenditure (PCE) data later this week.
In Congress, discussions over funding to avert a government shutdown until September 30 have added to market uncertainty.
Meanwhile, traders have scaled back expectations of a rate cut at the Federal Open Market Committee’s October meeting. According to the CME Group’s FedWatch Tool, Fed funds futures currently indicate a 10.2% probability of rates being held steady, up from 8.1% on Friday.
Against the yen, the dollar held firm at ¥147.74, remaining within the trading range established since early August.
