The rupee ended at 83.48/$1 on Tuesday, against 83.49/$1 the previous day, Reuters data showed, and traded in an 83.47-83.51 band during the interday session.
Powell is scheduled to give his semi-annual testimony to the US Congress on Tuesday and Wednesday.
A slight fall in crude oil prices on Tuesday helped the sentiment for the rupee. Ease in oil prices bodes well for India’s current account deficit and inflation, as the country is a major importer of the commodity.
Global crude oil prices fell to $85.54 a barrel on Tuesday, from $85.75 on Monday, data showed as Hurricane Beryl shut down U.S. refineries and ports in the Gulf of Mexico.
The benchmark 10-year Indian government bond yield was largely unchanged at 6.98% on Tuesday, up from 6.99% on Monday, CCIL data showed.
“There was not much activity today. People are holding their positions ahead of the budget announcement as many market players are anticipating borrowing cuts”, said a trader at a primary dealership.
Banking system liquidity, as measured by the RBI’s absorption of funds, stood at Rs. 77,262 crore on July 8, RBI data showed. Absorption of funds by RBI indicates excess liquidity with banks.
Market participants expect the liquidity of the banking system to remain on the upward side as G-Sec Rs. 60,944 crore due to mature on July 28, RBI data showed.
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