Rupee ended higher, Pound falls vs. Dollar

Monday,   02-Dec-2019   05:22 PM (IST)

The Indian rupee ended the session higher at 71.65/66 levels compared to its opening at 71.78/79 levels after touching the high of 71.6250/6350 levels tracking foreign banks’ dollar sales as well as corporate inflows. Rupee traded in the range of 71.6250-71.8150 levels. Traders said, foreign banks sold dollar as some inflows related a digital payment company raising around $1 billion hit the market.  Asian currencies traded mixed as uncertainty over the progress of a Sino-U.S. trade deal persists. Still, Asian shares gained after upbeat manufacturing data from China that improved the outlook for global growth. The country's manufacturing sector activity inched up in November, but the upturn remained subdued as growth rates for new orders as well as production were modest, a monthly survey said on Monday. The IHS Markit India Manufacturing PMI rose to 51.2 in November from 50.6 in October, when it had fallen to a two-year low, indicating only a slight improvement in the health of the sector. Indian government bonds ended lower for the second consecutive session on continued profit-booking following weaker-than-expected economic growth numbers, as a rate cut later this week has already been factored in. The benchmark S&P BSE Sensex closed 8.36 points, or 0.021 per cent, higher at 40,802.17 levels. The broader Nifty50 index held the psychological mark of 12,000, and closed at 12,048.20, down 7.85 points or 0.065 per cent. In the forward segment 1mth, 3mth and 6mth annualized premia ended the day at 3.18%, 3.26% and 3.66% respectively.

The pound fell on Monday as polls showed a growing probability the Dec. 12 UK election would end in a hung parliament. British Prime Minister Boris Johnson’s Conservative Party saw its lead over Labour narrow to 9 percentage points in the past week but remains the front runner, a Survation poll for ITV’s Good Morning Britain said on Monday. The Japanese yen fell to a six-month low on Monday and the Australian and New Zealand dollars rallied after an unexpected rebound in Chinese manufacturing activity raised hopes of a brighter outlook for the world economy. The euro was steady ahead of a testimony to the European parliament later in the day by the European Central Bank’s new president, Christine Lagarde. A tightening British election race knocked the pound lower. The latest data out of China, the world’s second biggest economy, set the tone for currency markets. Chinese factory activity expanded at the quickest pace in almost three years in November, a private business survey showed on Monday, following upbeat official data over the weekend.