Dubai: Indians in the UAE planning to send money home can expect exchange rates of UAE dirham against rupee turning in their favour next week as the Indian currency is expected to weaken further in the week ahead, according to experts.
Any weakness of rupee against the dollar will be reflected in the exhcange rate of the rupee against the dirham because of the UAE currency's peg against the dollar.
The rupee closed at Rs 74.5650 per dollar (about 20.32 a dirham on Friday).
High imported commodity prices is expected to weaken the Indian rupee against the US dollar during the week ahead, experts opined.
Tthe possibility of IPO (intial public offering) money outflow to foreign venture capitalists will also likely to impact rupee's position via-a-vis USD.
Last week, rupee consolidated in a narrow range and has been having a muted reaction despite various data releases.
"Indian rupee is expected to weaken against the US dollar in the coming week due to higher crude prices and a possible outflow of IPO money going back to foreign venture capitalists," said Sajal Gupta, Head, Forex and Rates at Edelweiss Securities.
"The safe-haven bets for dollar are still intact and after Powell's testimony FX traders aren't convinced over the insistence of dovish outlook," Rahul Gupta, Head Of Research- Currency, Emkay Global Financial Services.
"Better than expected US retail sales data will appreciate the USDINR spot, rising bets for earlier than expected Fed Rate hike or tapering."
Experts predict a range of dollar/rupee (Spot) is expected to trade with a positive bias and quote in the range of 74.20 and 75.20.
"Next week, in the first half of the week we expect the momentum to remain relatively low as market participants remain cautious ahead of the ECB policy statement," said Gaurang Somaiya , Forex & Bullion Analyst, Motilal Oswal Financial Services.
"Expectation is that the central bank could continue to remain dovish thereby keeping gains capped for the EURUSD pair."
However, Devarsh Vakil- Deputy Head of Retail Research at HDFC Securities said: "The near-term outlook for the rupee remains bullish however central bank is likely to absorb the inflows and that would limit the upside in the near term."
"We expect rupee to trade in a range of 74.30-74.80 in the near term."
-- With IANS inputs
