Rupee ended higher, Dollar lower vs. major currencies

Friday,   18-Aug-2017   05:33 PM (IST)

The Indian rupee ended the session higher at 64.1375/1475 levels compared to its opening at 64.18/19 levels after touching the high of 64.08/09 levels as across-the-board dollar sales by banks, likely for their exporter clients, offset losses triggered by weak global risk appetite following a likely terrorist attack in Barcelona. Indian shares fell today led by Infosys Ltd that plunged after the resignation of Chief Executive Vishal Sikka heightened uncertainty about the IT services provider's future. The benchmark BSE Sensex closed down 0.85 percent at 31,524.68. The broader NSE Nifty ended 0.67 percent lower at 9,837.40. Indian sovereign bonds fell for the second week, after higher-than-expected retail inflation in July raised doubts on near-term rate cuts by the country’s Monetary Policy Committee. In the forward segment 1mth, 3mth and 6mth annualized premia ended the day at 4.46%, 4.41% and 4.37% respectively. India's foreign exchange reserves rose for a fifth week to a fresh record high of $393.61 billion as of Aug. 11, from $393.45 billion in the previous week.

The dollar pushed lower against the other major currencies on Friday, as investors remained cautious following a terrorist attack in Spain and as U.S. political tensions continued to dampen demand for the greenback. Sentiment on the greenback remained vulnerable after eight chief executives quit two business advisory councils on Wednesday, in protest over U.S. President Donald Trump’s controversial remarks on weekend violence in Virginia. The U.S. President reacted to the departures by disbanding the councils – the American Manufacturing Council and the Strategic and Policy Forum. White House Economic Adviser Gary Cohn denied rumors of his possible departure late Thursday. However, growing opposition to Trump’s positions, including from within his own party, have fueled concerns over the administration’s ability to implement its political agenda. The dollar was also under pressure after the minutes of the Federal Reserve’s July policy meeting released on Wednesday showed that members of the central bank remain divided over the need to raise interest rates further this year, citing low inflation. Demand for the safe-haven currencies strengthened after a van rammed into pedestrians in a crowded tourist area of Barcelona on Thursday evening, killing at least 13 people and injuring 100 others.