BackRupee snaps nine-day rally to close weaker against US dollar
The rupee closed at 67.41 a dollar, down 0.29% from its previous close of 67.22
Premium
Mumbai: The Indian rupee on Tuesday weakened against the US dollar, snapping a nine day rally, tracking losses in the local equity and Asian currencies markets. Traders are cautious ahead of the Reserve Bank of India’s bi-monthly policy on Wednesday.
The rupee closed at 67.41 a dollar, down 0.29% from its previous close of 67.22. The local currency opened at 67.29 a dollar and touched a high and a low of 67.28 and 67.44, respectively.
Slowing inflation and a fiscally responsible budget may sway the Reserve Bank of India (RBI) to cut interest rates on Wednesday, according to a Mint survey of economists from 10 banks.
Seven out of 10 bank economists polled by Mint expect the RBI to cut its repo rate by 25 basis points to 6%. The other three expect the rate to remain unchanged.
The government will issue index of industrial production data on Friday. According to Bloomberg analyst poll, IIP will be at 1.4% in December from 5.7% a month ago.
India’s benchmark Sensex index fell 0.37% or 104.12 points to closed at 28,335.16. So far this year, Sensex has risen 6.42%.
Bond yield gained for six out of seven trading sessions. India’s 10-year bond yield closed at 6.431% from its Monday’s close of 6.414%. Bond yields and prices move in opposite directions.
Since the beginning of this year, the rupee has gained 0.78%, while foreign institutional investors (FIIs) have bought $201 million from local equity and sold $218.70 million in debt markets.
Asian currencies markets were trading lower amid concerns over political uncertainty including protectionist trade rhetoric coming from the US.
Singapore dollar was down 0.72%, Japanese yen 0.66%, Taiwan dollar 0.56%, South Korean won 0.55%, China offshore 0.54%, Philippines peso 0.41%, China renminbi 0.31%, Malaysian ringgit 0.2%, Indonesian rupiah 0.07%, Thai baht 0.07%.
The dollar index, which measures the US currency’s strength against major currencies, was trading at 100.64, up 0.73% from its previous close of 99.907.
Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!
