Rupee drops 21 paise to three-week low of 71.23 on fading US-China trade deal optimism
The rupee declined by 21 paise to close at a three-week low of 71.23 against the US currency on Monday as investors rushed to safe haven bets on fading hopes of an initial trade deal between the US and China
At the interbank foreign exchange market, the rupee opened higher at 70.83 and touched an intra-day high of 70.74 against the American currency
However, later the local unit pared initial gains and finally settled at 71.23 against the US dollar, down 21 paise over its previous close
On Friday, the domestic unit had closed at 71.02 against the US dollar
Mumbai: The rupee declined by 21 paise to close at a three-week low of 71.23 against the US currency on Monday as investors rushed to safe haven bets on fading hopes of an initial trade deal between the US and China.
Weak Chinese trade data also weighed on the domestic currency, analysts said.
At the interbank foreign exchange market, the rupee opened higher at 70.83 and touched an intra-day high of 70.74 against the American currency.
However, later the local unit pared initial gains and finally settled at 71.23 against the US dollar, down 21 paise over its previous close. On Friday, the domestic unit had closed at 71.02 against the US dollar.
"Indian rupee opened higher but gave up all the gains and turned negative as the session progressed. Besides strength in the dollar index, foreign fund outflows also weighed on the Indian rupee," said V K Sharma, Head - PCG & Capital Market Strategy, HDFC securities.
The dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.17 percent to 98.46.
Sharma further noted that "US stock index futures turned lower after China said it needed to have further discussions before it would sign off on the so-called phase one trade deal US President Donald Trump touted on Friday".
President Donald Trump on Friday had said that the US had reached a "very substantial" Phase 1 trade deal with China.
However, the announcement came with a rider that the agreement was still to be put on to the paper, which will take somewhere between three to five weeks.
“Rupee after opening on a stronger note came under pressure against the US dollar following reports that China wants more talks before signing Trump's 'Phase One Deal'. On the domestic front, market participants were waiting for inflation number, which is expected to come in a little higher in September compared to the previous month," Gaurang Somaiyaa, Forex & Bullion Analyst, Motilal Oswal Financial Services Private Ltd commented.
"We expect the rupee to remain under pressure and quote in the range of 71.05 and 71.50(Spot)," he added.
Meanwhile, Brent futures, the global oil benchmark, dropped 2.02 percent to $59.29 per barrel on growth fears after Chinese trade data which showed imports and exports were lower than the forecast in September due to high US tariffs and weakening global growth.
"Spot USDINR has been trading in the range of 70.70 to 71.35 since starting of the October month. Looking at the weak economic data and foreign fund outflows, the rupee could depreciate further from here in the short term," Sharma said.
Foreign investors infused a net Rs 895.63 crore in the Indian equities on Friday, according to exchange data.
In the domestic equity markets, the 30-share Sensex ended 87.39 points, or 0.23 percent, higher at 38,214.47. It hit an intra-day high of 38,513.69 and a low of 38,066.13. The broader NSE Nifty too rose 36.10 points, or 0.32 percent, to end at 11,341.15.
The 10-year government bond yield was at 6.48 percent.
The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 71.0272 and for rupee/euro at 78.2421. The reference rate for rupee/British pound was fixed at 88.4298 and for rupee/100 Japanese yen at 65.78.
Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.
Rupee slips 30 paise to 71.27 as Moody's cuts India rating outlook to negative; cites lower economic growth
The Indian rupee opened on a cautious note and fell 30 paise to 71.27 against the US dollar in early trade on Friday after Moody's changed its India rating outlook to negative citing lower economic growth
Snapping its three-session winning streak, the Indian rupee tumbled 28 paise to close at 70.97 against the US dollar on Wednesday as continuing uncertainty over the US-China trade deal affected currency market sentiment worldwide
The Indian rupee opened on a cautious note and fell 15 paise to 70.84 against the US dollar in early trade on Wednesday tracking subdued opening in domestic equities