Rupee sprints to near 3-wk high, up 13 paise vs US dollar

The euro extended gains to a two-and-a-half year high against the dollar on Monday after the European Central Bank president held back from talking down the currency and also concerns about the impact of Tropical Storm Harvey on the US economy.

By: PTI | Mumbai | Published: August 28, 2017 8:02:15 pm
rupee news, dollar news, business news, indian express news A strong showing by local equities along with extreme bearish dollar overseas mood also largely supported the rupee upsurge, a forex dealer commented. (File/Photo)

Firming up for the second straight session, the rupee on Monday rallied by another 13 paise to end at a near three-week high of 63.91 a dollar on account of heavy selling of the US currency by exporters and banks. This is the best closing level for the Indian currency since August 9, when it had settled at 63.84. The rupee on Monday opened higher at 63.93 against last Thursday’s close of 64.04 at the forex market. The domestic currency hit a fresh intra-day high of 63.85 in late afternoon deals before ending at 63.91, registering a smart gain of 13 paise, or 0.20 per cent.

The RBI, meanwhile, fixed the reference rate for the dollar at 63.8701 and for the euro at 76.2162.

Overall forex market sentiment also got a boost from easing of border tensions between India and China following a diplomatic breakthrough on months-long stand-off.

India and China have agreed to “expeditious disengagement” of border personnel at Doklam, New Delhi said today, a week before the BRICS summit in China that Prime Minister Narendra Modi is expected to attend.

A strong showing by local equities along with extreme bearish dollar overseas mood also largely supported the rupee upsurge, a forex dealer commented.

The greenback continued its prolonged Fed-driven weakness against all its major rivals on growing concerns about US President Donald Trump’s ability to drive his economic agenda even as the heavily anticipated speech by Federal Reserve Chair Janet Yellen in Jackson Hole failed to provide stronger policy guidance.

Meanwhile, domestic equity markets extended their spectacular rebound rally for the fourth-straight session on frantic buying across the board as appointment of former CEO and Aadhaar-architect Nandan Nilekani as its new chairman lifted overall trading sentiment amid positive global cues.

The flagship Sensex shot up by over 154 points to end at 31,750.82, while NSE Nifty recaptured the 9,900-mark by surging about 56 points to close at 9,912.80.

The dollar index, which measures the greenback’s value against a basket of six major currencies, was sharply down at 92.41.

In cross-currency trades, the rupee fell back against the pound sterling to finish at 82.53 from 82.07 per pound and also drifted sharply against the euro to settle at 76.22 from 75.54 earlier.

The local unit, however, remained firm against the Japanese yen to conclude at 58.50 per 100 yens from 58.53 previously.

The euro extended gains to a two-and-a-half year high against the dollar on Monday after the European Central Bank president held back from talking down the currency and also concerns about the impact of Tropical Storm Harvey on the US economy.

In forward market on Monday, premium for dollar remained weak due to consistent receivings from exporters.

The benchmark six-month premium payable in January eased to 118-120 paise from 120.50-122.50 paise and the far forward July 2018 contract also moved down to 255-257 paise from 257-259 paise.

On the international commodity front, energy markets were roiled on buoyed by potential output disruptions after Tropical Storm Harvey wreaked havoc along the US Gulf Coast over the weekend, crippling Houston and its port, and knocking out numerous refineries as well as some crude production.

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