Rupee ended lower, Pound rose vs. Dollar

Tuesday,   15-Sep-2020   02:47 PM (IST)

The Indian rupee ended the session lower at 73.6450/6550 levels compared to its opening at 73.38/39 levels after touching the low of 73.74/75 levels as state-run banks picked up greenbacks, likely on behalf of the Reserve Bank of India, and on importer covering. Rupee traded in the range of 73.31-73.74 levels today. India's federal government bond yields ended lower as retail inflation in August was below market estimates, and traders now expect the print to drop further in coming months, opening up space for policy easing. Equity markets were trading over half a per cent higher in Tuesday's final hour of trade, helped majorly by pharma stocks and financials. At 2:34 pm, the S&P BSE Sensex was trading at 39,052, up 295 point, while the broader Nifty50 was at 11,528 up 88 point. In the forward segment 1mth, 3mth and 6mth annualized premia ended the day at 4.06%, 3.83% and 3.98% respectively.

Sterling rose on Tuesday following better-than-expected jobs data and after British Prime Minister Boris Johnson cleared the first hurdle for legislation that would breach the Brexit treaty, although analysts said the bounce was likely temporary. Johnson won the so-called second reading parliamentary vote but faces a growing rebellion from his own party as the bill moves through parliament. The pound, which has fallen sharply in recent weeks as investors fretted that Johnson’s plan sharply increased the risk of a no-deal Brexit, was 0.4% higher at $1.2891, moving away from two-week lows. Against the euro, sterling gained, with the single currency down 0.1%, at 92.20 pence per euro. Despite the rise, analysts warned the pound would continue to face downward pressure. Sterling was also buoyed by slightly better-than-expected UK employment data. While Britain’s unemployment rate rose to 4.1% in the three months to July, from 3.9%, the number of people in employment fell by a much smaller-than-expected 12,000. Job vacancies rose to 434,000 between June and August, about 30% higher than in the April-to-June period but almost half pre-pandemic levels.