The dollar index, meanwhile, rose to its highest level in more than a year on Thursday and was last quoted marginally lower at 107.06 in Asia trading.The Indian rupee is expected to stay on the back foot on Friday, pressured by a rebound in the dollar amid uncertainty about the pace of rate cuts in the United States, while persistent portfolio outflows also remain a worry for the local currency.
The one-month non-deliverable forward indicated that the rupee will open little changed at 84.48-84.49 against the U.S. dollar.
The rupee weakened to an all-time low of 84.4925 on Thursday, pressured by outflows from local stocks.
Foreign investors net pulled out more than USD 600 million from Indian stocks on Thursday, according to provisional exchange data.
Intervention by the Reserve Bank of India (RBI) helped the rupee limit its losses amid pressure from the outflows.
"At these levels, the central bank is likely to remain active and only allow gradual rise (in USD/INR) of no more than 6-8 paisa in a day," a trader at a large private bank said.
The dollar index, meanwhile, rose to its highest level in more than a year on Thursday and was last quoted marginally lower at 107.06 in Asia trading.
Recent comments from some U.S. Federal Reserve officials have indicated the central bank may slow its rate cuts, helping the dollar.
Data on Thursday showed that the number of Americans filing new applications for unemployment benefits fell to a seven-month low, signalling resilience in the U.S. economy.
"Interest rate differentials and geopolitical concerns in the Russia Ukraine war continued to work in favour of the dollar," MUFG Bank said in a note.
Russia fired a missile at the Ukrainian city of Dnipro on Thursday in response to the U.S. and UK's decisions allowing Kyiv to strike Russian territory with advanced Western weapons.
Asian currencies were mixed on the day, with the Thai baht down 0.2%, while the Korean won, Indonesian rupiah and Philippine peso nudged higher.
