Rupee rises by 15 paise to 68.54 against dollar on gains in domestic equities, weakness in greenback overseas

Mumbai: The rupee on Monday advanced by 15 paise to close at 68.54 against the US currency, tracking gains in domestic equities and weakness in the greenback overseas. At the interbank foreign exchange market, the rupee opened at 68.59 a dollar and advanced to a high of 68.51 during the day. It finally settled at 68.54, up 15 paise against its previous close of 68.69. Forex traders said Indian rupee gained taking cues from the higher Asian currencies. [caption id=“attachment_5114261” align=“alignleft” width=“380”] Representational image. Reuters.[/caption] “Asian currencies gained after China’ economic growth data came in line with estimates and factory output and retail sales data for June beat the estimates, hinting at a recovery in the economy,” said V K Sharma, head PCG and capital markets strategy, HDFC Securities. The dollar index, which gauges the greenback’s strength against a basket of six currencies, slipped 0.01 percent to 96.80. Rajesh Cheruvu, the chief investment officer of Validus Wealth stated that the US dollar weakened post-China’s GDP data for the second quarter. According to analysts, Chinese data confirms slowdown fears which could play a role in tinkering of interest rate by the US Federal Reserve. Meanwhile, the 10-year government bond yield was at 6.43 percent on Monday. “India’s bonds rise for the fourth day after inflation data stayed below target last month, giving the central bank room to ease policy,” Sharma said. Wholesale price-based inflation declined for the second consecutive month to its 23-month low of 2.02 percent in June. Data released earlier this week showed that retail inflation spiked to a six-month high of 3.18 pc in June, on costlier food items. Market benchmark BSE Sensex ended in the positive territory, driven by heavy gains in index heavyweight Infosys and positive macroeconomic cues. The 30-share index settled 160.48 points or 0.41 percent higher at 38,896.71. The broader NSE Nifty ended 35.85 points, or 0.31 percent, up at 11,588.35. Meanwhile, Brent crude futures, the global oil benchmark, rose 0.42 percent to $67 per barrel. Foreign institutional investors (FIIs) remained net sellers in the capital markets, pulling out Rs 216.44 crore on Monday, provisional exchange data showed. The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 68.5855 and for rupee/euro at 77.2931. The reference rate for rupee/British pound was fixed at 86.0112 and for rupee/100 Japanese yen at 63.30.