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Rupee ended lower, Pound rose vs. Dollar

Monday,   15-Apr-2019   05:29 PM (IST)

The Indian rupee ended the session lower at 69.42/43 levels compared to its opening at 69.07/08 levels after touching the low of 69.45/46 levels as oil and other importers stepped up mid-month greenback purchases. However, banks stepped up dollar sales likely on behalf of exporters that trimmed some losses. Rupee traded in the range of 69.04-69.45 levels today. Most Asian currencies ended mixed against the greenback. Traders today watched for outflows related to over-subscription of the initial public offering of Polycab India. The IPO ended for subscription on Apr. 9. Meanwhile, India is expected to get near normal monsoon rains this year, the federal weather office said today, raising prospects of higher farm output and economic growth in Asia’s third-largest economy. India’s monsoon rainfall during June-September will likely be 96% of the long-term average with a five-percentage-point swing either ways, the nation’s federal weather office said today, adding there is very less chance for the monsoon rainfall to be above normal or excess. India's wholesale inflation accelerated to 3.18 percent in March as against 2.93 percent in February. Indian shares closed higher today buoyed by gains in IT major Tata Consultancy Services Ltd, which reported a record profit for the final quarter of the year on Friday and heralded the start of corporate earnings season. The benchmark BSE Sensex closed up 0.36 percent at 38,905.84, while the broader NSE Nifty ended 0.4 percent higher at 11,690.35. Indian government bonds rose on the first day of a holiday-truncated week, as slower core inflation and forecast of a near normal monsoon rainfall this year aided demand. In the forward segment 1mth, 3mth and 6mth annualized premia ended the day at 5.44%, 4.66% and 4.35% respectively.

The British pound rose back towards $1.31 on Monday, although trading was quiet in the absence of any significant Brexit-related developments as the Conservative and opposition Labour parties continue their talks. Volatility in the pound has collapsed since European Union leaders and the British government last week announced Brexit would be delayed for up to six months. That removed the immediate risk of a no-deal Brexit but also raised the possibility of months of political uncertainty in Britain as politicians struggle to agree over how best - or whether at all - to leave the EU. Britain’s Foreign Secretary Jeremy Hunt said on Monday that talks between the government and the opposition Labour Party to find consensus over a Brexit plan are more constructive than people think. This week will offers more clues as to how the British economy is holding up in the face of prolonged British uncertainty. On Tuesday, labour market data is published while Wednesday sees inflation numbers for March released.