close
Breaking news

A new line of argument has already come to dominate the public sphere: it’...read more The government has gone one step further to detect community spread of the coro...read more The government has issued an order to abolish the six allowances, including the...read more Aarogya Setu application launched by NIC is aimed to track COVID-19 affected pe...read more SEOUL| South Korea’s unemployment rate was unchanged in April as the coronavi...read more Amid the outbreak of Corona pandemic in the country, Indian government has been...read more Prime Minister Narendra Modi in his address to the nation on Tuesday indicated ...read more Corona infection in the country is taking a macabre form. So far, more than 74 ...read more Congress General Secretary Priyanka Gandhi Vadra has written a letter to UP Chi...read more On Tuesday, Prime Minister Narendra Modi announced a package of Rs 20 lakh cror...read more

Indian Rupee hits one-month high, zooms past 71-mark

The Indian rupee on Friday hit a one-month high to cross the 71-mark against the US dollar tracking gains in Asian currencies as the European Central Bank delivered a bigger-than-expected stimulus and the US administration considered an interim trade deal with China.

Having opened at 71.01 to a dollar, the Indian currency touched a high of 70.92 — a level last seen on 14 August. At 9.10 am, the local currency traded at 70.95, up 0.27% from its Thursday’s close of 71.67. The currency was higher for seventh consecutive sessions.

According to CR Forex Advisers, rupee is majorly driven by developments in the US-China trade talks, and hence the ongoing positive talks between the two seem to have set the wheels in motion for the currency. Nonetheless, one negative tweet is mightier than a tariff to get the rupee back to its recently formed zone. Thereby, 70.80 will be the next crucial level to be watched where the pair may rest for a while before resuming its drive or taking a reverse gear.

Sentiment was also positive after data on Thursday showed that the consumer price index-based inflation in August was within the central bank’s medium-term target, boosting expectations of a rate cut at next month’s policy meeting.

Retail inflation rose 3.21% in August versus 3.1% in July and core inflation dipped to 4.2%, reversing July’s rise to 4.5%. The CPI was lower than the 3.32% median estimate in a Bloomberg survey of 41 economists.

The yield on the 10-year Indian government bond was at 6.665% compared with its previous close of 6.664%.

“We expect inflation to evolve in line with the RBI’s projections. While we believe Q2 marked the trough in the growth rate cycle, the RBI’s FY20 GDP growth projection still appears too optimistic (RBI: 6.9%; Nomura: 6.0%) and is widely expected (by us as well as consensus) to be downgraded at the 4 October policy meeting. Hence, we expect the RBI to deliver a cumulative 40bp rate cut in Q4, most of which will likely be frontloaded in October itself,” according to Nomura Research report.

The benchmark equity index Sensex was up 0.3% at 37217.94 points. So far this year, the index has risen 3%.

In the year so far, the rupee has weakened 1.7%, while foreign investors have bought nearly $6.48 billion in Indian equities and $4.69 billion in debt.

Asian currencies were trading higher. Taiwan dollar was up 0.53%, South Korean won rose 0.35%, Indonesian rupiah gained 0.29%, Philippines peso climbed 0.22%, China Offshore advanced 0.18%, Thai baht was 0.09% higher and Singapore dollar rose 0.07%.

The dollar index, which measures the US currency’s strength against a basket of major currencies, was at 98.356, up 0.05% from its previous close of 98.309.

Tags: , , , , ,

Story Page

Download Our Mobile App