The Indian rupee declined today against the US dollar as speculations about potential monetary tightening from the Federal Reserve continues to support the greenback against other currencies, particularly riskier ones.
While analysts had mixed expectations for potential performance of the dollar this week, the US currency is clearly acting in favor of bulls, at least for now. This means that riskier currencies of emerging markets remain under pressure. Some experts argue, though, that stimulative monetary policies of many central banks may yet attract investors to Indian assets in search of higher yield. This should improve prospects for gold that would benefit from stronger rupee as the traditional gold-buying season is approaching.
USD/INR advanced from 60.4800 to 60.6800 as of 11:57 GMT today, bouncing from the daily low of 60.2755.
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