Rupee Slips as Risk-Off Sentiment Deepens, Nifty Signals Weak Opening

The Indian rupee is likely to start Friday on a weaker note, pressured by a widespread risk-off sentiment and softness seen in other Asian currencies.

In the NDF market, the Indian rupee is trading at 90.68-90.70, after closing at 90.59 on Thursday.

The muted effect of the central bank’s intervention has further dampened the near-term outlook for the rupee. Despite an unexpected pre-market move by the Reserve Bank of India to support the currency, the rupee posted only a slight gain on Thursday.

Although the RBI’s dollar sales sparked an early rally at the open, the momentum quickly faded. Importers took advantage of the brief recovery to initiate fresh hedging positions.

India’s benchmark equity indices are set to begin Friday on a weaker footing, mirroring losses in Wall Street and other Asian markets. Information technology stocks are expected to stay under pressure as investors remain cautious ahead of the U.S. inflation data scheduled for release later in the day.

Gift Nifty futures were quoted at 25,719.5, signaling that the benchmark Nifty 50 is likely to open below Thursday’s closing level of 25,807.2.