MUMBAI, May 27 (Reuters) - The Indian rupee was barely changed in early trading on Monday as dollar demand from local importers offset positive cues from an uptick in most Asian currencies.
The rupee was at 83.08 against the U.S. dollar as of 09:45 a.m. IST, marginally changed from its close at 83.0975 in the previous session.
The local currency rallied to a two-month high of 83.0250 on Friday boosted by likely dollar inflows.
Benchmark Indian equity indices, the BSE Sensex and Nifty 50, rose to fresh record highs on Monday and were last quoted up about 0.1% each.
"Don't think we'll see as sharp an intra-day move as Friday, but expect the rupee to move towards 83 this week," a foreign exchange trader at a state-run bank said.
Overall volumes could also be a little muted today given the holidays in the United States and United Kingdom, the trader added.
The dollar index was at 104.7 after declining nearly 0.3% on Friday while most Asian currencies gained with the Korean won up 0.2% and leading gains. The rupee may stand to see more gains on inflows from foreign investors and "with oil and dollar index on the positive side," Anil Kumar Bhansali, head of treasury at Finrex Treasury Advisors said.
Foreign investors net bought $707 million worth of Indian stocks on Thursday but have net pulled out $2.6 billion from equities in May so far, according to latest stock depository data.
Meanwhile, investors have further pared expectations of rate cuts by the Federal Reserve later this year after data released on Friday signalled robust momentum in the U.S. economy.
Investors are currently pricing in a nearly 50% chance of the Fed keeping rates unchanged in September, up from about 35% a week earlier, according to CME's FedWatch tool. (Reporting by Jaspreet Kalra; Editing by Nivedita Bhattacharjee)
