Mumbai: The Indian rupee Wednesday ended almost flat against the dollar at 62.69 ahead of the US Federal Reserve's monetary policy statement that could shed light on the timing of interest rate hikes.
The rupee resumed slightly higher at 62.68 per dollar as against the last closing level of 62.70 per dollar at the Interbank Foreign Exchange (Forex) Market. It hovered in a limited range of 62.6175 and 62.78 before concluding at 62.69, showing a marginal gain of one paise or 0.02 percent.
While the Fed is not expected to lift interest rates tonight, forex traders are keeping a keen eye on what it has to say about its near-term plans.
There are expectations that the word 'patient' will disappear from the forward guidance part of the Fed's statement, while Fed will say that they're not in a hurry to raise rates, said a forex dealer.
The dollar index, a gauge of six major global rivals, was down by 0.18 percent today.
Pramit Brahmbhatt, Veracity Group, CEO said, "Rupee traded slightly strong for the day...Exporters & banks were seen selling dollars".
Also, the local equities traded low and ended on a weak note for the day which dented the rupee movement, he added.
The trading range for the spot USD/INR pair is expected to be within 62.30 to 63.20, Brahmbhatt said.
In New York market, the dollar traded flat against most rivals yesterday, and inched lower against the euro for the second session, ahead of the expected release of the Federal Open Market Committee's monetary policy statement.
Meanwhile, the Indian stock benchmark Sensex failed to maintian initial gains and ended lower by 114.26 points or 0.40 percent to close at 28,622.12.
Suresh Nair, Director, Admisi Forex said: "The Rupee remained in a very small trading range ahead of the Fed policy meet tonight. However, custodian inflows through foreign banks continue to offset importers' dollar purchases.
"We believe that the markets may have already factored in a dovish policy and any hint on rate hikes this year or change in tone from the Fed chief could push the pair to 63 and above."
Meanwhile, the forward premia eased on sustained receiving by exporters.
The benchmark six-month premium payable in August moved down to 216-217.5 paise from yesterday's closing level of 217.5-218.5 paise while forward contracts maturing in February 2016 ended almost stable at 434-435.5 paise.
The Reserve Bank of India fixed the reference rate for dollar at 62.6720 for Euro at 66.3383.
The rupee continued to remain firm against the pound to 91.95 as against 92.51 yesterday while ended lower against the euro to 66.55 per euro as against 66.47 per euro yesterday.
The domestic currency also dropped against the yen to 51.75 per 100 Japanese yen from 51.71 previously.
