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Rupee recovers from fifteen-month lows, ends up 5 Paise at 67.08 against Dollar

The benchmark six-month forward premium payable in September remained stable at 101-103 paise, while the far-forward February 2019 contract moved up to 231.50-233.50 paise from 229-231 paise previously.

By: PTI | Mumbai |
May 8, 2018 8:10:29 pm
Rupee The currency had closed at a 15-month low of 67.13 against the US currency on Monday. (Representational Image)

The rupee on Tuesday recovered from 15-month lows to close five paise higher at 67.08 against the US currency on suspected RBI intervention and stray dollar demand.

Suspected intervention by the Reserve Bank coupled with dollar selling by foreign banks predominantly helped the rupee to stay afloat, a forex dealer commented. The local unit witnessed wide swings between a high of 66.98 and a low of 67.27 — fresh 15-month low — in day trade. The local unit finally settled at 67.08, showing a gain of 5 paise, or 0.07 per cent. The currency had closed at a 15-month low of 67.13 against the US currency on Monday.

Crude oil prices retreated from 3-1/2 year highs as investors waited on an announcement by President Donald Trump on whether the United States will reimpose sanctions on Iran. Brent crude, an international benchmark, was trading at USD 75.50 a barrel in early Asian trade. In its first retreat in a week, West Texas Intermediate crude dropped 1.3 per cent to $69.80 a barrel, the first retreat in a week

A strong dollar in overseas markets however restricted any major gain in the rupee. The US dollar advanced its winning streak against major rivals following the US Federal Reserve bank chairman Jerome Powell comments to keep the path of monetary policy normalisation throughout 2018. The RBI, fixed the reference rate for the dollar at 67.0809 and for the euro at 80.0074.

The yield on the benchmark 7.17 per cent debt maturing in 2028 drifted to 7.58 per cent from 7.62 per cent. Meanwhile, domestic bourses failed to hold early gains and ended near flat in a volatile trade. The dollar index, which measures the greenback’s value against a basket of six major currencies, was higher at 92.93. In the cross currency trade, the rupee bounced back against the pound sterling to finish at 90.58 from 90.83 and also recovered against the euro to end at 79.60 from 79.97 on Monday.

The Pound sterling remained under pressure against the US dollar ahead of the Bank of England (BoE) meeting on Thursday even as the tussle over Brexit between the House of Lords and the government continues. The home unit, however dropped further against the Japanese Yen to close at 61.55 per 100 yens as compared to 61.42 earlier. In forward market on Tuesday, premium for dollar displayed steady to firm trend due to lack of market moving factors.

The benchmark six-month forward premium payable in September remained stable at 101-103 paise, while the far-forward February 2019 contract moved up to 231.50-233.50 paise from 229-231 paise previously.

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