Rupee edges up; RBI policy in focus
Reuters Market Eye - The rupee is trading at 54.78/79 versus its previous close of 54.84/86 as traders await the Reserve Bank of India's policy decision at 11.00 a.m. for direction.
Markets are broadly positioned for a status quo at the policy review but a surprise rate cut can boost shares and indirectly hurt the USD/INR.
Asian shares edge up tracking overnight gains in U.S. stocks, as fresh signs of compromise maintain a new optimism that the U.S. "fiscal cliff" budget tussle could be settled before tax hikes and spending cuts begin to bite early next year.
USD/INR is seen moving in a 54.70 to 54.90 band until the policy review.
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The recent market correction was overdue. A further correction would be an opportunity for those who missed the rally in the past few months. The markets could get a reality check next year and consolidate before the next big movement. I still believe PM Modi will not fritter away his mandate and deliver on his promise, albeit with a delay, writes Ambareesh Baliga. Article