Indian rupee opens tad lower; retail inflation data, flows eyed

MUMBAI (Reuters) - The Indian rupee opened marginally lower to the U.S. currency on Friday, as traders awaited the retail inflation data and eyed whether there will be any follow-through dollar demand.

The rupee was trading at 79.6750 per dollar by 0332 GMT, compared to 79.63 in the previous session.

** Data due later in the day expected to show India inflation rate eased in July, but remained above the Reserve Bank of India's (RBI) upper tolerance limit.

** Rise in Treasury yields and dollar index rebound to support USD/INR pair.

** Fed officials continue to push back against expectations of less hawkish stance.

** Long weekend to deter short dollar positions. Indian forex and money markets shut on Monday and Tuesday.

**"Have to see whether the big dollar demand we saw yesterday, likely for oil and defence related, will continue today," a trader at a state-run bank said.

(Reporting by Nimesh Vora; Editing by Rashmi Aich)