Rupee Gains Marginally In Early Trade

The rupee bounced-back from all-time low level and inched higher by 2 paise to 78.02 against the US dollar in opening trade on Tuesday. At the interbank foreign exchange, the rupee opened at 78.02 against the dollar, registering a rise of 2 paise over its previous close. In initial deals, the domestic unit also surged to 77.90 against the American currency but could not hold on to the gains and touched 78.06. On Monday, the rupee depreciated by 11 paise to close at a fresh lifetime low of 78.04 against the US dollar.

"There is no fresh trigger to predict if the Rupee will be 79 or 80 unless and until there is a conflict between US and China with regards to Taiwan, other than that there shouldn't be any correction towards 77, 77.50 in the spot. There are no any fresh triggers at this point in time, expect Fed to hike rates by 50bps as expected and surprise the markets by a 75 bps hike. If Fed indeed hikes rate by more than 50 bps then they will take a pause in the September meet.

Although the sentiments are negative because the equity markets are down, once Nifty recovers, currency will recover too. Once INR touches 77.80 in the spot there will a recovery towards 77.50/77.20 level, the Emkay Currency Desk stated.