Mumbai: The rupee erased all its gains and closed one month low after the dollar turned positive ahead of the release of key US manufacturing PMI data. This was the second consecutive session on which the rupee fell.

The rupee closed at 68.33 per dollar—a level last seen on 1 December 2016, down 0.15% from its previous close of 68.23. The home currency opened at 68.08 against the dollar and touched a low of 68.37. Since 1 April 2016 till date, the rupee has fallen 3.05%.

“The data will continue to show that the US economy is strengthening which will be positive for the US dollar," said Satish Kumar analyst with Choice Broking firm.

The last US Federal Reserve meeting signalled a faster pace of increases this year as the Donald Trump administration takes over with promises to boost the US economy through tax cuts, spending and deregulation.

Traders are also cautious ahead of the release of the minutes of the Federal Open Market Committee meeting on Thursday. The minutes will be closely watched for signs of any potential change in the fiscal policy and any impact on the US monetary policy.

Traders says that the Geo political uncertainties following North Korea’s fresh nuclear testing also added fuel to the dollar demand.

“Importer has likely bought the dollar to avert the risk", said Abnish Kumar Sudhanshu, Director & Research Head, Amrapali Aadya Trading & Investments.

Bond yield erased all the losses and turned positive after the international crude oil prices jumped to an 18 month high as output cuts by Kuwait and Oman signaled OPEC and its partners are delivering on their agreement to stabilize the market.

The 10-year bond yield closed at 6.445%, compared to Monday’s close of 6.409%. Bond yields and prices move in opposite directions.

India’s benchmark Sensex index closed at 26,643.24 points, up 0.18% or 47.79 points from its previous close. Since 1 April till date, Sensex has gained 5.2%.

So far this fiscal year, foreign institutional investors bought $1.69 billion in equity, while they sold $5.72 billion in debt.

Most of the Asian currencies’ fell. Japanese yen was down 0.65%, Thai Baht 0.39%, China renminbi 0.22%, Philippines peso 0.22%, Malaysian ringgit 0.17%, Singapore dollar 0.04%. However, South Korean won was up 0.38% and Taiwan dollar 0.17%.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 103.37, up 0.57% from its previous close of 102.78