Rupee opened higher, Dollar lower vs. major currencies
Wednesday,
05-Aug-2020
10:45 AM (IST)
The Indian rupee opened the day higher at 74.9250/9350 levels compared to its previous close at 75.05/06 levels as dollar resumes decline on sliding Treasury yields. Indian government bond yields ease marginally in thin-volume early trade as investors await MPC policy decision tomorrow. Domestic stock market built on its previous day's gains and was trading nearly a per cent higher on Wednesday. At 10:06 AM, the S&P BSE Sensex was trading at 38,059 up 371 point, while the broader Nifty50 was at 11,206 up 111 point. As per the technical indicators range for the USDINR pair may be 74.70-75.10 levels. Rupee has an immediate support at 75.00 levels. A breach of the same may see rupee at 75.08 followed by 75.27 levels. On the positive side rupee is likely to face resistance at 74.85 levels and if it is able to break the same then it may gain up to 74.70 levels followed by 74.68 levels.
The dollar was down in Asia on Wednesday morning, with hopes of a U.S. economic recovery from COVID-19 continuing to diminish. Investors retreated from the greenback as the U.S. Congress failed to reach a consensus over the country’s latest stimulus measures and U.S. yields continue to plummet. Although White House negotiators vowed on Tuesday to work “around the clock” to reach a consensus by the end of this week, U.S. Treasury Secretary Steven Mnuchin warned that “we’re not going anywhere close” to the $3.4 trillion price tag sought by Democrats. U.S. and Chinese officials are reported to be meeting to review the implementation of the phase 1 trade deal between the two countries, as well as discussing mutual grievances during an August 15 videoconference. Meanwhile, the dollar’s losses have been the Euro’s gain after the European Union reached a consensus on a COVID-19 rescue package in July. The Euro posted its best month in almost a decade against the greenback in the same month. But some investors suggested that a pile-in could provide more support to the greenback, with equity investors still skeptical over the EU package’s ability to kick start the European economic recovery from COVID-19.
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