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Rupee ended lower, Pound holding gains vs. Dollar

Monday,   05-Nov-2018   05:28 PM (IST)

The Indian rupee ended the session lower at 73.12/13 levels compared to its opening at 72.80/81 levels after touching the low of 73.13/14 levels in line with regional peers, as robust U.S. employment data raised bets of quicker interest rate hikes in the world’s largest economy. However, continued decline in global crude oil prices capped losses in the local currency. Rupee traded in the range of 72.76-73.13 levels today. The seasonally adjusted Nikkei India Services Business Activity Index rose to 52.2 in October, from 50.9 in September. Indian shares closed lower today dragged by non-banking financial companies after a top government official raised concerns about liquidity in the sector. The benchmark BSE Sensex fell 0.17 percent to 34,950.92, while the broader NSE Nifty declined 0.27 percent to 10,524. Indian government bonds fell for the first time in three sessions, as losses in the local currency and higher U.S. Treasury yields made the notes less attractive for investors. In the forward segment 1mth, 3mth and 6mth annualized premia ended the day at 4.25%, 4.00% and 4.13% respectively.

The common currency eases against its American rival to fresh daily lows in the 1.1360 area. Volatility limited, dollar mixed, as speculative interest waits for fresh clues in a week overcharged with first-tier events. The GBP/USD pair holds on to daily gains and trades near daily highs not far above 1.3000, overshadowing its rivals in a low volatility environment. Sterling up despite Services PMI miss. The GBP/USD opened with the gap on the upside rising to a fresh 2-week high of 1.3045 on Brexit optimistic weekend headlines suggesting the UK will finalize the financial services deal this week. The news slowly receded with the UK fundamentals playing in and the GBP/USD fell back below 1.3000. After the GBP/USD closes the gap falling to 1.2960, positive Brexit headlines are set to target 1.3085 next on the upside. The UK Finance Ministry Official responsible for the financial services industry John Glen said that he is extremely confident in reaching a Brexit deal on financial services imminently.