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Rupee strengthens against US dollar in opening trade

LiveMint logoLiveMint 22-05-2017 Ravindra N. Sonavane

Mumbai: The Indian rupee on Monday strengthened against the US dollar in opening trade, tracking gains in the local equity markets.

The rupee opened at 64.51 a dollar. At 9.15am, the rupee was trading at 64.49 a dollar, up 0.21% from its Friday’s close of 64.64.

The benchmark Sensex index rose 0.55% or 167.95 points to 30,632.87. So far this year, it has risen 13%. Indian markets gained nine out of 11 trading sessions after the government fixed the rates of the goods and services tax (GST) on almost all commodities and services.

So far this year, the rupee has gained 5.5%, while foreign investors bought $7.17 billion and $9.56 billion in local equity and debt markets, respectively.

The 10-year bond yield was trading at 6.681% compared to its previous close of 6.677%. Bond yields and prices move in opposite directions.

Asian currencies were trading mixed. South Korean won was up 1.06%, Taiwan dollar 0.82%, Malaysian ringgit 0.3%, Indonesian rupiah 0.20% and Philippines peso 0.16%. However, Japanese yen was down 0.22%, China renminbi 0.06%, China offshore 0.05% and Thai baht 0.05%.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 97.314, up 0.18% from its previous close of 97.142.

The dollar gained as stocks and Treasury yields rose after investors judged the recent selloff on US political turmoil may be excessive given the backdrop of economic resilience and a potential rate increase, Bloomberg reported.

Traders were cautious ahead of the key OPEC decision in Vienna on Thursday. OPEC and its allies agree on extending oil output cuts by nine months, according to a Bloomberg report. Traders were also cautious ahead of the minutes from the 3 May US Federal Reserve policy meeting which will be released Wednesday.

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