Rupee ended lower, Pound edges up vs. Dollar
Monday,
06-Dec-2021
04:08 PM (IST)
The Indian rupee ended the session lower at 75.42/43 levels compared to its opening at 75.2150/2250 levels after touching the low of 75.4525/4625 levels, amid a continuous selloff in local equities and broad dollar gains. Traders have turned a little more cautious after new cases of the Omicron variant were detected across India, leading to dollar outflows. Rupee traded in the range of 75.19-75.4525 levels today. Asian shares extended losses, while currencies in the region were also lower following data that showed a decline in the U.S. unemployment rate and improved labor market participation. Indian federal government bond yields ended little changed in a thinly traded session today, as investors awaited the monetary policy decision, due on Wednesday. The S&P BSE Sensex crashed 1.65% for a second consecutive day, and the move was in line with other Asian indices. Foreign banks continue to remain on the bid side for the dollar as foreign investors have remained major sellers of Indian shares in the last two weeks. The BSE settled with a significant loss of 949 points at 56,747. The NSE Nifty ended 284 points lower at 16,912. In the forward segment 1mth, 3mth and 6mth annualized premia ended the day at 3.37%, 3.68% and 4.54% respectively.
Sterling edged higher against the dollar on Monday, but remained close to a 2021 low hit last week as investors awaited a speech on monetary policy and economic growth from Bank of England Deputy Governor Ben Broadbent. Markets now broadly expect the BoE to keep interest rates unchanged in its Dec. 16 policy meeting as the Omicron variant spreads across the world. But investors will be watching BoE's Broadbent, due to speak at Leeds University at 1130 GMT. The pound rose to $1.3267, not far from a 2021 low of $1.3194 touched last week. The pound was under pressure on Friday after BoE policymaker Michael Saunders, who voted for an interest rate hike in November, said he wanted more information about the impact of the new Omicron coronavirus variant before deciding how to vote this month. In the meantime, the Confederation of British Industry has cut its forecasts for economic growth to 6.9% in 2021 and 5.1% in 2022 from previous estimates of 8.2% and 6.1% due to global supply chain problems. A survey showed growth in Britain's construction industry hit its strongest pace in four months in November after a slowdown caused by global supply chain problems and labour shortages, while soaring inflation pressures abated.
|