The Indian rupee declined against the U.S. currency on Monday, weighed by the dollar index’s jump and the Chinese yuan’s weakness.

The rupee last traded at 81.84 to the dollar, down from 81.6850 on Friday. The local unit held a narrow 81.75 to 81.90 range during the session.

It could be a “reasonably” quiet week unless there is a big surprise from the Fed minutes, which is quite unlikely, a spot trader at a private bank said.

It looks like 81-83 will be the broad range for the rupee with the Reserve Bank of India likely there on both sides, the trader added.

The central bank has likely been mopping up dollar following rupee’s rally to above 81.

Concerns over China’s economic outlook dampened risk appetite, boosting demand for the safe-haven dollar. The dollar index climbed 0.8% to 107.80, while the offshore Chinese yuan declined by about the same margin.

New COVID-19 flare ups in China have cast doubts on hopes that the government could soon ease its tough restrictions. That has boosted the dollar and weighed on demand for the yuan.

Shares in Hong Kong and China declined, while futures pointed to a weaker opening for U.S. equities. Indian equities fell by the most in over a month.

Investors are now awaiting minutes of the U.S. Federal Reserve’s November meeting due during U.S. trading hours on Wednesday. The meeting was held prior to the softer-than-expected U.S. October inflation data. (Reporting by Nimesh Vora; Editing by Dhanya Ann Thoppil)


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