USD/INR: Rupee opens 28 paise higher, eyes Fed

• Indian Rupee has opened higher, possibly tracking the decline in oil prices. 
• INR may gain ground if the Federal Reserve delivers a dovish rate cut.

Indian Rupee (INR) jumped to 71.50 per US Dollar in early trade, having closed at 71.78 per US Dollar on Tuesday. 

The uptick in the Indian unit could be associated with Tuesday's 6% drop in oil prices triggered by comments from Saudi Arabi's energy minister that the country has managed to restore oil supplies to levels seen before the weekend attacks on its facilities. 

Focus on the Fed

Economists expect the US Federal Reserve to cut rates by 25 basis points despite the resilient consumer spending and easing trade tensions. 

The market, however, is not sure whether the Fed will deliver a rate cut. For instance, the probability of the rate cut stood at 50/50 on Tuesday, according to CME's FedWatch tool. 

If the Fed keeps rates unchanged, the USD/INR pair will likely open higher on Wednesday. The INR and other currencies could gain ground against the US Dollar if the Fed cuts rates by 25 basis points and sets the stage for another rate cut later this year. 

• Federal Reserve Preview September 17-18 FOMC: Even Odds

Technical levels