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Rupee weakens marginally against US dollar

LiveMint logoLiveMint 09-06-2017 Ravindra N. Sonavane

Mumbai: The Indian rupee on Friday weakened marginally against the US dollar ahead of the key macro economic data due next week.

The rupee opened at 64.28 a dollar. At 9.15am, the rupee was trading at 64.26, down 0.06% from its Thursday’s close of 64.21.

The 10-year bond yield was trading at 6.534% compared to its previous close of 6.532%. Bond yields and prices move in opposite directions.

The government will issue Index of Industrial Production (IIP) and Consumer Price Index (CPI) inflation data for April and May, respectively, on Monday. According to Bloomberg estimates, CPI will be at 2.5% for May from 2.99% a month ago. IIP will be at 2.8% for April from 2.7% in March.

On Wednesday, the Reserve Bank of India (RBI) kept key rates unchanged but cut its inflation forecast sharply. For the first half of fiscal year 2017-18 (April-September), CPI is now seen at 2.0-3.5% and for the second half at 3.5-4.5%. This marks a revision from 4.5% and 5.0% estimated earlier, respectively.

The benchmark Sensex index fell 0.13% or 41.33 points to 31,172.03. Year-to-date, it has gained 17.14%.

So far this year, the rupee has gained 5.58%, while foreign investors bought $7.35 billion and $11.82 billion in local equity and debt markets, respectively.

Asian currencies were trading mixed. Philippines peso was up 0.15%, South Korean won 0.12%, Thai baht 0.09% and Indonesian rupiah 0.05%. However, Japanese yen was down 0.2%, China offshore 0.08% and Taiwan dollar 0.04%.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 97.317, up 0.41% from its previous close of 96.918.

Prime Minister Theresa May faced calls to quit on Friday after her election gamble to win a stronger mandate backfired, throwing British politics into turmoil and potentially delaying the start of Brexit negotiations. With no clear winner likely to emerge from Thursday’s vote, a wounded May vowed to provide stability, while her Labour rival Jeremy Corbyn said she should step down, according to a Reuters report.

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