Rupee ended higher, Euro gains vs. Dollar

Friday,   02-Nov-2018   05:30 PM (IST)

The Indian rupee ended the session higher at intraday high of 72.4350/4450 levels compared to its opening at 73.10/11 levels helped by a sharp decline in crude oil prices and improved risk sentiment. Improvement in the Chinese Yuan and most Asian currencies also aided rupee. Rupee today traded in the range of 72.4350-73.2150 levels. The rupee’s rise came after U.S. President Donald Trump’s comments on Twitter raised hopes that trade tensions between Washington and Beijing could ease, which boosted global risk appetite and prompted a broad retreat on the dollar. Indian Oil Corp is in talks with oil suppliers such as Iraq and Saudi Arabia to take a part of their payment in rupee, A.K. Sharma, director for finance, said today, as the state-run refiner seeks to address the rising price of crude amid falling value of the local currency. Indian shares climbed today and clocked their best weekly gain in nearly two-and-a-half years, as the rupee rose and as crude prices softened. The broader NSE index ended 1.66 percent higher at 10,553, while the benchmark BSE index closed 1.68 percent higher at 35,011.65. Indian government bonds rose for a fourth week, driven by a slump in crude oil prices, sharp gains in rupee and open market purchases of notes. In the forward segment 1mth, 3mth and 6mth annualized premia ended the day at 4.27%, 4.08% and 4.21% respectively. India's foreign exchange reserves fell to $392.08 billion as of Oct 26, compared with $393.52 billion a week earlier, the Reserve Bank of India said.

The EUR/USD is trading around 1.1445, extending the rally. Trump has reportedly instructed his cabinet to prepare a trade deal with China. The news boosts stocks and weighs on the greenback. The US Non-Farm Payrolls is awaited. The EUR/USD hit a double-bottom at 1.1300 on the last day of October and has enjoyed significant gains so far in November. The GBP/USD is trading above 1.3015, up on the day. Markets cheered the news that Trump is moving forward on trade with China. Earlier in the week, the hope of reaching a Brexit deal boosted the Pound. Construction PMI beat with 53.2 points. Reports about a post-Brexit arrangement for the financial services sector sent Sterling higher on Thursday. Other optimistic comments also helped. Markit's Construction PMI beat expectations with 53.2 points.