MUMBAI: The Indian rupee is expected to open weaker on Thursday on concerns about a recession in Europe and continued worries about foreign fund outflows from the stock market.
Traders, who were watching the Reserve Bank of India for more actions, said recent measures spelt out by the central bank to shore up the rupee looked short-lived with slowing growth and widening trade deficit in Asia's third-largest economy weighing.
The euro was on the defensive against the dollar in Asia, having shed all the week's gains as investors doubted a massive 489 billion euro tender by the European Central Bank (ECB) would solve the EU debt crisis.
The euro package has failed to restore confidence that the enormous debt problem will go away and local equities are not fairing well on domestic growth concerns, said Ashtosh Raina, head of forex trading at HDFC Bank.
Traders, who were watching the Reserve Bank of India for more actions, said recent measures spelt out by the central bank to shore up the rupee looked short-lived with slowing growth and widening trade deficit in Asia's third-largest economy weighing.The rupee is expected to open at 52.80 to the dollar and move in a 52.50 to 53.00 range, traders said. It closed 0.7 percent stronger at 52.49/50.
An Indian official on Wednesday played down worries about the rupee's recent slide to record lows and said trying to defend the currency is not worth the risk it would pose to the country's reserves.
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