Rupee closes lower against US dollar1 min read . Updated: 04 Apr 2018, 05:35 PM IST
The rupee ended at 65.15 a dollar, down 0.21% from its Tuesday's close of 65.01
Mumbai: The Indian rupee on Wednesday closed weaker against US dollar after local equity markets fell over 1% as trade war fears escalate.
The home currency ended at 65.15 a dollar, down 0.21% from its Tuesday’s close of 65.01. The rupee opened at 64.98 a dollar and touched a high and a low of 64.91 and 65.18, respectively.
China announced 25% tariff on 106 products in 14 categories imported from the US, including soybeans, automobiles and chemicals. Earlier, US announced tariffs on Chinese products worth about $50 billion. It focuses on high-tech items and aims to minimize the impact on US consumers, Bloomberg reported.
Benchmark Sensex fell 1.05%, or 351.56 points, to 33,019.07. So far this year, it has declined 3%.
Bond yield hit two-month low after CNBC TV reported that finance ministry has proposed three options to raise limit on foreign portfolio investors’ investment in government bonds to 6%, 7% and 8% of the outstanding. FPI participation in the government bonds should be increased slowly and steadily, the report added.
The 10-year bond yield ended at 7.294% compared to its previous close of 7.331%. Bond yields and prices move in opposite directions.
Traders are cautious ahead of the Reserve Bank of India’s bi-monthly policy decision on Thursday. According to a Mint poll, the central bank will keep interest rates unchanged in the first monetary policy review of the current fiscal year, amid a gradual recovery in growth and easing inflation.
Markets will also await US employment data due on Friday. The jobless rate probably fell in March after holding at 4.1% for five straight months.
So far this year, the rupee has fell 1.75%, while foreign investors have bought $2.13 billion in equity and bought $246 million in debt market.
Asian currencies market were trading lower. South Korean won was down 0.47%, China offshore 0.39%, China renminbi 0.19%, Taiwan dollar 0.17%, Thai baht 0.16%, Philippines peso 0.11%, Singapore dollar 0.1%. However, Japanese yen was up 0.47%.
The dollar index, which measures the US currency’s strength against major currencies, was trading at 90.097, down 0.11% from its previous close of 90.20.