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Rupee strengthens further against US dollar in opening trade

LiveMint logoLiveMint 31-03-2017 Ravindra N. Sonavane

Mumbai: The Indian rupee on Friday strengthened further against the US dollar ahead of the end of the financial year 2017.

The rupee opened at 64.92 a dollar and touched a high of 64.83. At 9.15am, the home currency was trading at 64.84—up 0.10% from its Thursday’s close of 64.92.

Rupee, the third best-performing Asian currencies this year, surged nearly 4.63% in the March quarter, its best quarterly gains since September 2012, on better domestic and global developments.

On the domestic front, foreign investors are bullish about local equity and bond markets on hopes for faster reforms after the Bhartiya Janata Party, or BJP, won Uttar Pradesh assembly polls with a thumping majority. Traders also welcomed the clearance of Goods and Services Tax (GST) bill in the Lok Sabha on Wednesday.

Recently, the government has said that it would make a policy announcement on tackling bad loans shortly. All these factors will help extract more inflows in the country.

Globally, US Federal Reserve’s soft guidance and US President Donald Trump’s inability to pass health reform bill boosted speculation that he may struggle to push through economic stimulus programmes.

So far this year, foreign institutional investors have bought $6.09 billion and $4.32 billion from local equity and debt markets, respectively.

The 10-year bond yield was trading at 6.678%, compared to its previous close of 6.698%. Bond yields and prices move in opposite directions.

The benchmark Sensex index rose 0.05% or 16.22 points to 29,631.20. So far this year, it has risen 10%.

Asian currencies were trading lower. South Korean won was down 0.23%, Taiwan dollar 0.2%, Philippines peso 0.16%, Japanese yen 0.15%, Malaysian ringgit 0.14%, China renminbi 0.13%, Indonesian rupiah 0.05%.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 100.54—up 0.13% from its previous close of 100.41

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