Ahead of the crucial monetary policy announcement by the US Federal Reserve on Thursday, the rupee is delicately poised. Though some fundamental factors offer support to the domestic currency, the relentlessly strengthening dollar has clouded analysts’ view on the course of the local unit.
The US central bank is likely to raise interest rates by a minimum of 75 basis points (bps) again this week; around 30 per cent of traders in Fed funds futures predict a 100-bp hike.
The prospect of higher interest rates in the US has sent the dollar index soaring. So far in July-September, the dollar