Rupee closes higher, buoyed by strong domestic equities1 min read . Updated: 26 Sep 2019, 06:25 PM IST
- The rupee closes at 70.88 a dollar, up 0.22% from its previous close of 71.04
- The currency will likely trade sideways for the next few sessions and shall eye global and domestic developments for further cues, say analysts
The Indian rupee on Thursday closed stronger against the US dollar tracking gains in domestic equities. In the last five sessions, domestic stock markets have gained nearly 9%.
Gains in other Asian currencies which rose as President Donald Trump indicated that the US-China trade deal is very close to getting done and decline in international crude, also boosted sentiments.
The rupee closed at 70.88 a dollar today, up 0.22% from Wednesday's close of 71.04. The Indian unit had opened at 70.98 a dollar.
According to CR Forex Advisors, the currency will likely trade sideways for the next few sessions and shall eye global and domestic developments for further cues. It shall remain stable and range between 70.50-71.50 levels.
Meanwhile, the benchmark Sensex closed 1.03% or 396.22 points higher at 38989.74. So far this year, the index has gained 8%.
The yield on the 10-year Indian government bond was at 6.717% compared with its previous close of 6.758%.
"India bonds have been under pressure since the corporate tax cut was announced but could receive some support if there are no surprises in the above-mentioned events. We believe markets would be surprised positively by an external debt issuance", said Nomura Research in a note to its investors.
Traders await a number of key events in the coming weeks, including the release of the second half of FY20 bond supply calendar, the formalization of the Reserve Bank of India’s liquidity management framework and the announcement of a new 10-year benchmark bond.
In the year so far, the rupee has weakened 1.6%, while foreign investors have bought nearly $6.73 billion in Indian equities and $4.34 billion in debt.
Most other Asian currencies also closed higher today. The Philippines peso was up 0.14%, Japanese yen 0.10%, China Renminbi 0.08%, Taiwan dollar 0.06%, China Offshore 0.06%, Thai Baht 0.05%. However, Malaysian ringgit was down 0.1%, Indonesian rupiah 0.05%.
The dollar index, which measures the US currency’s strength against a basket of major currencies, was at 98.902, down 0.14% from its previous close of 99.037.