Rupee Rises Against Dollar, Set To Finish Week Higher: 10 Things To Know
- The rupee opened higher at 68.60 against the dollar, compared to Wednesday's close of 68.83, and advanced as much as 30 paise to touch 68.53 in intraday trade.
- Indication of an end to the tightening rate cycle in the US also supported the currency, say analysts.
- The Federal Reserve on Wednesday brought its three-year drive to tighten monetary policy to an abrupt end, abandoning projections for any interest rate hikes this year amid signs of an economic slowdown. The US central bank, after the end of its two-day policy meeting, said it would halt the steady decline of its balance sheet in September.
- “An unchanged stance as of now with possibility of a rate cut means that the dollar would no longer be strengthening against the other currencies… This is positive news for the rupee which will appreciate on this score. However a lot depends on how the other factors turn out such as current account deficit and capital flows,” said CARE Ratings in a note.
- Steady crude oil prices also provided some support to the rupee, according to analysts. Brent futures - the global benchmark for crude oil prices - were last seen trading at $67.90 per barrel. They had hit a four-month high of $68.69 per barrel in the previous session.
- Foreign institutional investors (FIIs) remained net buyers in the capital markets, putting in Rs 1,771.61 crore on a net basis on Wednesday, provisional data from the National Stock Exchange showed.
- So far this month, foreign portfolio investors have pumped in Rs 26,073.23 crore into the equity segment, according to data from the NSDL.
- Credit ratings agency Fitch said on Friday that it expects the rupee to weaken to 72 against the dollar by the end of December 2019, and further to 73 by December 2020.
- Meanwhile, Fitch also lowered India's GDP growth forecast for the next fiscal year to 6.8 per cent from 7 per cent, on weaker than expected economic momentum.
- In the equity markets, the Sensex and Nifty declined over 0.5 per cent owing to weakness in auto, banking, oil & gas and IT shares.
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