By Nimesh Vora

MUMBAI, April 16 (Reuters) - The Indian rupee is expected to open mostly unchanged to marginally higher on Wednesday, amid a pause in the recent U.S. dollar selloff and a lull in tariff-related headlines.

The 1-month non-deliverable forward indicated that the rupee INR=IN will open at 85.74-85.78 to the U.S. dollar compared with 85.7725 in the previous session.

The rupee has seen choppy price action in recent sessions, pulled in opposite directions by importer demand and a broadly softer U.S. dollar. After briefly touching a high of 84.96, the rupee weakened to 86.70 due to dollar buying by importers.

A currency trader at a bank said that the dollar’s outlook remains weak and he prefers selling USD/INR on rallies.

“I would be looking to play the 85.50–86.50 range,” with risks equally balanced, the trader said.

Following last week's excessive cross-asset moves, markets have started the week on a calmer note. The U.S. Treasury market, equities, and the dollar have shown signs of stabilizing, though analysts caution that the subdued volatility may be short-lived.

Attention will be on the U.S. investigation into whether imports of pharmaceuticals and semiconductors pose national security risks, a move that has revived concerns about fresh tariffs.

“The fear is that the findings may lead to new tariffs,” ANZ Bank said in a note.

On Wednesday, traders will look to U.S. retail sales data for signals on the health of the world's biggest economy and a speech from Federal Reserve Chair Jerome Powell.

KEY INDICATORS:

** One-month non-deliverable rupee INRNDFOR= forward at 85.90; onshore one-month forward premium at 19.5 paise

** Dollar index =USD at 99.86

** Brent crude futures LCOc1 down 0.2% at $64.5 per barrel

** Ten-year U.S. note yield at 4.33%

** As per NSDL data, foreign investors sold a net $273mln worth of Indian shares on April 11

** NSDL data shows foreign investors sold a net $82.1mln worth of Indian bonds on April 11

(Reporting by Nimesh Vora; Editing by Eileen Soreng)

((nimesh.vora@tr.com))