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Rupee snaps 3-day rally, down 5 paise at 66.51 vs USD

The rupee Friday lost 5 paise to end at 66.51, halting its three-straight session rally, on fresh demand for the American currency from importers and banks amid bout of global risk aversion.


Rupee snaps 3-day rally, down 5 paise at 66.51 vs USD

Mumbai: The rupee Friday lost 5 paise to end at 66.51, halting its three-straight session rally, on fresh demand for the American currency from importers and banks amid bout of global risk aversion.

Bullish dollar sentiment overseas alongside sluggish domestic equity market predominantly impacted the domestic currency.

The dollar has staged a broad-based rally against all its major trading partners on growing confidence of economic activity.

The home currency opened sharply lower at 66.63 from Tuesday's closing value of 66.46 at the Interbank Foreign Exchange (Forex) Market and drifted further to 66.65 due to renewed dollar demand.

After trading in a tight range most part of the day, the local unit managed to curtail losses toward the fag-end trade and settled down at 66.51, revealing a loss of 5 paise, or 0.08 per cent.

It had been gaining over the past three days.

In worldwide trade, the dollar bull run continued for the second straight day against all major leading currencies buoyed by an improvement in US economic data and also hawkish comments from FOMC members, raising expectations for a December rate hike by the Federal Reserve.

The greenback had been on a strong footing after rallying at the start of the week on an upbeat survey of the US manufacturing sector.

Pound Sterling remained under immense pressure after plunging to a three-decade low overnight on worries that Britain's separation from the European Union could have adverse economic consequences.

Meanwhile, the euro soared to a five-year peak against the struggling pound on Wednesday and scaled a three-week high against the yen, bolstered by rising eurozone government bond yields following reports of ECB policy change.

The dollar index was trading down by 0.03 percent at 96.08 as against a basket of six currencies in late afternoon trade.

The RBI today fixed the reference rate for the dollar at 66.5699 and euro at 74.6515.

In cross-currency trades, the rupee continued to rule firm against the pound sterling to end at 84.62 from 84.68 and strengthened further against the Japanese yen to finish at 64.54 as compared to 64.87 per 100 yens yesterday.

The home unit, however, edged lower against the euro to settle at 74.59 from 74.20 earlier.

In the forward market, premium for dollar remained under severe pressure owing to sustained receiving by exporters.

The benchmark six-month premium for March declined to 179-181 paise from 182-184 paise and the forward-September 2017 contract also slipped to 356.5-357.5 paise from 360-362 paise previously.

Domestic equities retreated after a three-day rally on fresh profit-taking amid lacklustre global cues.

The benchmark BSE Sensex slumped by 113.57 points to close at 28,220.98, while broader Nifty fell by 25.20 points to 8,743.95.

Foreign portfolio investors (FPIs) bought shares worth a net Rs 344.13 crore yesterday, according to provisional data.

Crude prices shot up over 1 percent in Asian trading after a private agency report in US showed oil inventories may have dropped for a fifth straight week.

The upmove was also received a much needed bump overnight as OPEC appears to have finally agreed that cuts are needed to stabilise global prices.

From Zee News

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