Connect with us

Hi, what are you looking for?

Finance

Rupee surges to one-week high, up 14 paise against dollar

The rupee strengthened further by 14 paise to end at a fresh..

The rupee strengthened further by 14 paise to end at a fresh one-week high of 63.49 against the US currency on sustained dollar selling by exporters amid record rally in domestic equities.

Besides, steady unwinding of dollars by banks and corporates supported the rupee upmove.

The forex market got a new impetus last week after the country's factory output growth surged to a 17-month high of 8.4 per cent in November, confirming that an economic recovery is underway.

However, retail inflation accelerated to 5.2 per cent in December last year.

In contrast, inflation based on wholesale prices eased to 3.58 per cent in December 2017.

The Central Statistics Office recently projected the economic growth may to slip to 6.5 per cent in 2017-18 from 7.1 per cent last fiscal amid lingering effects of demonetisation and GST.

Foreign investors pumped in over Rs 5,200 crore in the Indian capital markets this month so far on anticipation of recovery in corporate earnings and attractive yields.

Meanwhile, the country's foreign exchange reserves surged by USD 1.758 billion to mount a new record high of USD 411.124 billion in the week to January 5.

In the international commodity front, global crude prices held just below December 2014 highs, supported by ongoing output cuts led by OPEC and Russia despite a rise in US and Canadian drilling activity.

Brent crude futures were trading weak at USD 69.85 a barrel in early Asian trading.

Meanwhile, the record-breaking run at the domestic bourses remained unabated for the third-straight session driven by strong liquidity as investors' sentiment got a lift following bullish macro data and encouraging corporate earnings from select blue-chip companies.

Asian markets also finished higher after a buoyant Wall Street lead.

The flagship BSE-Sensex shot-up 251 points to close at 34,843.51, while Nifty surged 60 points to end at 10,741.55.

Reacting to weekend robust macro data, the rupee opened sharply higher at 63.49 against previous close of 63.63 at the Interbank Foreign Exchange (forex) market amid weak greenback overseas.

Maintaining overall bullishness, it later hit a high of 63.33 in mid-morning deals.

However, some fag-end dollar demand from importers forced rupee to surrender its early strong gains to end at 63.49, still showing a healthy gain of 14 paise, or 0.22 per cent.

The RBI, meanwhile, fixed the reference rate for the dollar at 63.4125 and for the euro at 77.4457.

On the global front, the dollar continued to drop and hit a fresh three-year low against other major currencies on Monday, still weighed by the euro's sustained strength.

The dollar index, which measures the greenback's value against a basket of six major currencies, was down at 90.27 in early trade.

In cross-currency trades, the rupee dropped further against the pound sterling to finish at 87.46 per pound from 86.77 and drifted against the Japanese yen to end at 57.41 per 100 yens from 57.27 earlier.

The rupee also fell sharply against the euro to settle at 77.87 compared to 77.19 last Friday.

The euro continued to ride higher to hit multi-year high, driven by hopes on the German coalition breakthrough news and also boosted by the release of better than expected Eurozone trade balance data.

In forward market today, premium for dollar showed sluggish trend owing to mild receiving from exporters.

The benchmark six-month premium payable in June moved down to 127-129 paise from 129-131 paise and the far forward December 2018 contract also eased to 264-266 paise from 266.50-268.50 paise previously.

Original Article

[contf]
[contfnew]

ET Markets

[contfnewc]
[contfnewc]

Click to comment

Leave a Reply

Your email address will not be published.