Home >Markets >Stock Markets >Rupee weakens for fourth session ahead of RBI policy announcement

MUMBAI : The Indian rupee weakened for the fourth consecutive session against the US dollar ahead of the Reserve Bank of India's (RBI) bi-monthly policy review due later on Wednesday.

At 9.15am, the rupee was at 70.93 a dollar, down 0.12% from its Tuesday's close of 70.83. The domestic currency opened at 70.98 and has so far touched a high of 70.89 and a low of 70.99 a dollar. So far this year, the currency has declined 1.3%.

The 10-year government bond yield was at 6.312% compared with its previous close of 6.339%.

Traders await the central bank’s rate decision amid growing market expectations for a bigger-than-expected cut in interest rates and guidance on further easing.

RBI may lower the benchmark repurchase rate by 25 basis points to 5.5%, according to almost all the 36 economists surveyed by Bloomberg. Swap markets are pricing in at least another 50 basis points of reductions before the end of 2019.

The benchmark equity index, Sensex, rose 0.49% to 37,157.63 points. So far this year, it has risen 2.52%.

Year to date, foreign investors have bought nearly $8.51 billion in equity and $2.62 billion in debt.

Currencies were trading lower after China’s central bank set its daily fixing near 7 per dollar, slightly weaker than expected. The New Zealand dollar plunged more than 1% after the Reserve Bank of New Zealand cut its benchmark interest rate by a deeper-than-expected 50 basis points.

Most Asian currencies were trading weak on Wednesday. Philippines peso was down 0.47%, China Offshore fell 0.38%, China renminbi lost 0.35%, Singapore dollar declined 0.15%, Thai Baht fell 0.12%, Malaysian ringgit declined 0.11%, and Indonesian rupiah was down 0.1%. However, Japanese yen was up 0.44%.

The dollar index, which measures the US currency’s strength against a basket of major currencies, was at 97.522, down 0.11% from its previous close of 97.63.

(Bloomberg contributed to this story)

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