Dollar-rupee to trade in 50.00-51.25 range

Last week, the domestic currency traded at almost twomonth high aided by strong inflows into the domestic stock markets and improved risk sentiments globally.

The rupee strengthened from its all-time lows mainly on account of steps taken by RBI to control volatility and other global factors. The euro traded relatively stronger against the dollar in spite of multiple rating downgrades of member countries in the euro zone.

Further strengthening of the rupee was capped by dollar demand from oil and other importers and volatility in the euro-dollar pair.

In the short term, the movement in the dollar-rupee pair would largely be influenced by the Reserve Bank’s action on interest rates, macro-economic growth indicators, upcoming assembly elections to state legislatures and the Budget, apart from events unfolding in euro zone countries.

We expect the dollar-rupee pair to trade in the range of 50.00-51.25.

Hariprasad Head — Treasury CentrumDirect