MUMBAI: The Indian rupee was largely unchanged on Tuesday, sidestepping an uptick in its Asian peers that were aided by a dip in US Treasury yields.

The rupee was at 83.1350 against the US dollar as of 09:55 a.m. IST, barely changed from its close of 83.1325 in the previous session.

While the dollar index was largely steady near 103.45, most Asian currencies were up between 0.1% to 0.3%.

The 10-year US bond yield was last quoted at 4.05% in Asia hours, its weakest level in nearly two weeks, after falling about 7 basis points (bps) on Monday.

US bond yields fell after US the Treasury Department said it would need to borrow less in the January-March quarter than it previously estimated.

The rupee is expected to “remain in a small range,” on Tuesday with nothing much expected to occur before the Federal Reserve delivers its verdict on interest rates, Anil Bhansali, head of treasury at Finrex Treasury Advisors said.

Indian rupee edges down tracking Asian peers, gauges oil price jump

While investors widely expect the Fed to keep rates unchanged on Jan 31, Chair Jerome Powell’s statement and press conference may offer cues on when the Fed might begin to start easing rates.

Investors are currently pricing in a slightly less than 55% chance of the Fed keeping rates unchanged in March, up from 11.5% at the end of December, according to CME’s FedWatch tool.

Meanwhile, rupee forward premiums ticked higher with the 1-year implied yield rising 2 bps to 1.88%.

The market is currently in a “wait and watch mode,” but even if the Fed tilts hawkish, the rupee’s support at 83.30 should hold, a foreign exchange trader at a private bank said.

Investors will be keeping an eye on US job openings data for December due later in the day alongside the consumer confidence index for January.