Rupee ended higher, Dollar edges higher vs. major currencies

Thursday,   21-May-2020   02:49 PM (IST)

The Indian rupee ended the session higher at intraday high of 75.6050/6150 levels compared to its opening at 75.69/70 levels tracking gains in local equities, while mounting tensions between the U.S. and China continued to dominate the broader market. Large foreign banks and one private bank were on dollar sales towards the latter half of today’s trading session, likely on behalf of their custodial clients. Rupee traded in the range of 75.6050-75.8175 levels today. Other Asian benchmarks ended mixed while currencies were mostly lower. Indian government bond yields ended marginally lower as investors awaited a debt auction tomorrow amid hopes that central bank will announce open market bond purchases. Indian equities were trading in the green on Thursday. At 2:11 pm, the S&P BSE Sensex was trading at 31,061, up 243 point, while the broader Nifty50 was at 9,127 up 61 point. In the forward segment 1mth, 3mth and 6mth annualized premia ended the day at 3.56%, 3.67% and 3.77% respectively.

The dollar edged higher on Thursday as Sino-U.S. tensions and weak economic indicators in Europe dented sentiment after hopes of a quick economic recovery and further stimulus fuelled an overnight rally on Wall Street. Against a basket of currencies the greenback rose 0.2% to 99.40 while U.S. stock futures were trading in the red. EUR/USD is trading closer to 1.0970, down from the highs. Rising Sino-American tensions are weighing on the market mood and boosting the dollar. Eurozone flash PMIs are mixed with Germany's manufacturing PMI missing expectations. GBP/USD is holding onto 1.2225 after UK PMIs beat expectations and bounced more than expected. BOE Governor Bailey is open to negative rates, fraught Brexit talks, and amid a souring market mood that supports the dollar. Japan reported its steepest drop in exports in more than a decade and cratering factory activity. The Japanese yen was down 0.3% at 107.800 per dollar. The risk-sensitive Aussie was last at $0.6568 down 0.4%.