Rupee opened higher, Euro lower vs. Dollar

Tuesday,   14-Aug-2018   09:10 AM (IST)

The Indian rupee opened the day higher at 69.85/86 levels compared to its previous close at 69.9325/9425 levels as India’s retail inflation slows more than expected, helping offset continued concerns over Turkey. Data released after market hours yesterday showed consumer prices in India rose by 4.17% last month, slowing from 4.92% in prior month. Indian government bonds are higher in early trade as retail inflation eases to nine-month low in July and as rupee steadies against dollar after settling at record low of 69.94/95 levels yesterday. It’s a positive start to the equity market today morning, with the Nifty trading around 11,400 in the opening tick, while the Sensex gained 100 points. The Sensex was up 110.66 points at 37,755.56, and the Nifty gained 30.30 points at 11,386.10. As per the technical indicators range for the USDINR pair may be 69.30-70.10 levels. Rupee has an immediate support at 69.96 levels. A breach of the same may see rupee at 70.16 followed by 70.31 levels. On the positive side rupee is likely to face resistance at 69.63 levels and if it is able to break the same then it may gain up to 69.41 levels followed by 69.25 levels.

The euro hovered near one-year lows against the dollar and the Swiss franc on Tuesday as the Turkish lira wobbled, on worries economic troubles in Turkey could hit European banks and spread to other emerging economies. Investors are nervous the plunge in the lira could prompt capital outflows from other emerging economies that run a hefty current account deficit and rely on foreign capital. The euro traded at $1.1405, having fallen to a 13-month low of $1.1365 on Monday. So far this month it has lost 2.4 percent. Investors have rushed to the safe haven Swiss franc, which hit a one-year high of 1.1288 franc per euro on Monday and last stood at 1.1324.The Turkish lira slipped 0.6 percent in early Asian trade on Tuesday to 6.955 per dollar, though it hovered above a record low of 7.24 hit on Monday after the central bank pledged to provide liquidity. The lira has fallen almost 30 percent so far this month on concerns about President Tayyip Erdogan's reluctance to raise interest rates despite rising inflation and a deepening diplomatic rift with the United States. The yen slipped from highs as the dollar was helped by rises in U.S. bond yields. The 10-year U.S. Treasuries yield bounced back to 2.877 percent from a three-week low of 2.848 percent. The South African rand also fell more than 10 percent at one point on Monday to hit a two-year low of 15.70 to the dollar, although it later pared much of losses. It last stood at 14.41. Argentina's currency fell 2.4 percent to close at a record low 29.97 per dollar on Monday, as a local corruption scandal added to its woes, prompting the country's central bank to hike interest rates by 5 percentage points to 45 percent.