The one-month non-deliverable forward indicated that the rupee will open at 83.56-83.58 to the U.S. dollar compared with 83.67 in the previous session.
The rupee's winning run halted on Tuesday amid dollar buying by a large corporate and other importers alongside outflows related to a MSCI rebalancing that happened last Friday.
In Wednesday's session, the rupee "will benefit in a sympathetic move" looking at the yuan, Srinivas Puni, managing director at FX advisory firm QuantArt Market Solutions, said.
The dollar/rupee remains range-bound, with bias on the downside considering that the dollar is pressured by Fed rate cut expectations, Puni said.
The offshore yuan strengthened past the 7.00 handle against the U.S. dollar on optimism over China's stimulus package. China's central bank lowered the cost of its medium-term loans to banks on Wednesday, in a move consistent with broad policy measures announced a day earlier to shore up the economy.
The yuan was further helped by weak U.S. consumer confidence data that increased the probability that the Fed will once more cut rates by 50 basis points (bps) at its next meeting in November. U.S. consumer confidence unexpectedly fell in September.
U.S. consumer confidence has now "slipped to near the bottom of the narrow range it has been in over the past two years," ANZ Bank said in a note.
Swaps are now pricing in a more than 60% probability of a 50 bps Fed cut at the November meeting, nearly double compared to a week ago.
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