BackRupee closes 8 paise stronger against dollar at 61.36
The rupee tracked gains of the domestic markets which rose after the government announced diesel price deregulation and a hike in gas prices
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Mumbai: The Indian rupee strengthened against the dollar on Monday, tracking the gains in local equities and Asian currency markets.
The local unit opened at 61.21 per dollar. At 1.55pm, the home currency ended at 61.36 per dollar, up 0.13% from its previous close of 61.44 per dollar, while BSE’s benchmark Sensex index closed at 26,429.85 points on BSE, up 1.23%.
Asian currencies closed higher. Indonesian rupiah was up 0.65%, South Korean won rose 0.57%, Thai baht added 0.34%, Singapore dollar advanced 0.24%, Philippines peso edged up 0.19%, China offshore gained 0.12%, while Malaysian ringgit rose 0.06%.
Domestic stock markets were trading higher after the government announced diesel price deregulation and a hike in gas prices from the current $4.2/mmBtu to $5.61/mmBtu.
Finance minister Arun Jaitley said going forward, gas prices will be revised every six months. The victory by Bharatiya Janata Party (BJP) in the assembly elections of Maharashtra and Haryana also boosted sentiment.
On Sunday, Bloomberg reported ratings agency Moody’s as saying that India’s rating and outlook includes such policy changes and the diesel decontrol reduces exposure of government finances to oil.
The yield on India’s 10-year benchmark bond ended at 8.36%, compared with its Friday’s close of 8.39%. Bond yields and prices move in opposite directions.
Since the beginning of this year, the rupee has gained 0.72%, while foreign institutional investors have bought $13.33 billion from local equity markets.
The dollar index, which measures the US currency’s strength against major currencies, was trading at 85.08, down 0.04% from the previous close of 85.110.
Markets, which were looking at the outcome of assembly elections from the point of view of whether BJP would be able to send more members of Parliament (MPs) in the next Rajya Sabha elections have been relieved.
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