Rupee opens 18 paise higher against US dollar ahead of US Fed meet oucome

The rupee on Wednesday opened 14 paise higher at 69.56 against the US dollar amid positive global cues and rise in crude oil prices.

The domestic unit on Tuesday surged by 21 paise to close at 69.70 as easing crude prices and a weak dollar ahead of the US central bank's meeting helped the currency snap its three-day losing streak.

"Market participants are waiting for the monetary policy of Federal Open Market Committee (FOMC), Bank of England and Bank of Japan, scheduled this week. The reaction of FOMC meeting outcome would be seen in the Indian currency market on Thursday," said V K Sharma, Head-PCG & Capital Market Strategy, HDFC Securities.

Foreign institutional investors (FIIs) remained net sellers in the capital markets, pulling out Rs 528.91 crore equities and debt securities Monday, provisional data showed.

"Fed governor commentary is expected to remain dovish and that could keep the greenback under pressure. Today, USD/INR pair is expected to quote in the range of 69.40 and 70.05-70.20," says Gaurang Somaiya, Research Analyst (Currency) at Motilal Oswal Financial Services (MOFSL). 

On the global front, Asian share markets jumped on Wednesday as investors dared to hope the Federal Reserve would open the door to future rate cuts at its policy meeting later in the day. MSCI’s broadest index of Asia-Pacific shares outside Japan climbed 0.6 per cent in early trade, adding to a 1% gain the day before, Reuters reported. 

In the overnight trade, The Dow ended Tuesday with gains of 1.35 per cent, while the S&P 500 rose 0.97 per cent and the Nasdaq 1.39 per cent.

In the commodities market, Brent crude futures bounced 40 cents to $62.54, while U.S. crude firmed 45 cents at $54.35 a barrel, said a Reuters report.