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Rupee closed down by modest 2 paise at 68.67 against USD

Traders turned cautious in the run-up to the outcome of RBI monetary policy committee meeting that began today.


PTI 30 Jul 2018, 01:38 PM India

The rupee today closed down by a modest 2 paise at 68.67 against the US currency to end its three-session gaining streak due to month-end dollar demand.

Traders turned cautious in the run-up to the outcome of RBI monetary policy committee meeting that began today.

Sustained weakness in Asian currencies, particularly the Chinese yuan, as investors awaited the decisions of key central bankers also weighed on appetite for the local currency.

The Bank of Japan will announce the outcome of its monetary policy meeting tomorrow, followed by the US Federal Reserve on Wednesday.

The Indian unit resumed lower at 68.70 against weekend close of 68.65 at the Interbank Foreign Exchange (forex) market.

It traded with negative bias throughout the session and hit an intra-day low of 68.80 on heavy month-end dollar demand from oil refiners

However, a weak dollar overseas and record-setting stock rally in domestic equities helped the rupee overcome initial wobbliness and limit the downtrend.

The rupee recouped early steep losses towards the tail-end trade before settling at 68.67, showing a nominal loss of 2 paise. The local currency had appreciated 29 paise in the three-day rally.

Foreign funds and investors put in over Rs 1,800 crore in the Indian equity markets so far in July after a long selling spell. The latest inflow comes after such investors had taken out more than Rs 20,000 crore from the stock market during April-June.

On the energy front, crude prices regained some lost ground amid caution over the supply outlook. The benchmark Brent for September was trading higher at USD 74.91 a barrel in early Asian trade.

The Financial Benchmarks India private limited (FBIL), meanwhile, fixed the reference rate for the dollar at 68.7531 and for the euro at 80.1597.

The bond market showed lackluster trading activity ahead of RBI policy meet and the 10-year benchmark yield ended marginally higher at 7.79 percent.

In the cross-currency trade, the rupee also retreated against the pound sterling to finish at 90.05 per pound from 89.94 and fell back against the euro to end at 80.22 compared to 79.82 earlier.

The local currency also dropped against the Japanese yen to close at 61.84 per 100 yens from 61.77.

In forwarding market today, the premium for dollar displayed a steady trend owing to lack of market-moving factors.

The benchmark six-month forward premium payable in November and the far-forward May 2019 contract quoted at 99-101 paise and 197.50-199.50 paise, respectively.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)


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