Rupee opened lower, Dollar eased vs. major currencies

Thursday,   19-May-2022   09:51 AM (IST)

The Indian rupee opened the day lower at 77.72/73 levels compared to its previous close at 77.58/59 levels as selloff in global equities on growth concerns fuels broad decline in regional currencies. India's sovereign bond yields trading lower in early session, as minutes of the latest monetary policy meeting did not add to any new hawkishness and were largely seen on expected lines. The benchmark BSE Sensex and the broader NSE index slumped tracking similar move in most Asian peers following a rout on U.S. equities on worries over the impact of high inflation and central bank monetary tightening on growth. At 9:18 AM, the S&P BSE Sensex was trading at 53,175 down 1034 point, while the broader Nifty50 was at 15,968 down 272 point. As per the technical indicators range for the USDINR pair may be 77.40-77.90 levels. Rupee has an immediate support at 77.75 levels. A breach of the same may see rupee at 77.87 followed by 77.98 levels. On the positive side rupee is likely to face resistance at 77.58 levels and if it is able to break the same then it may gain up to 77.45 levels followed by 77.32 levels.

Safe-haven currencies, including the dollar, eased on Thursday, pausing for breath after big gains the previous session as Wall Street stocks tumbled amid mounting concerns that aggressive tightening by the Federal Reserve and other global central banks could choke growth. The dollar index, which tracks the greenback against six major peers, edged 0.05% lower to 103.74, after a 0.55% jump overnight that ended a three-day losing streak. The yen slipped, with the dollar adding 0.21% to 128.495 yen after a 0.86% tumble on Wednesday. The Swiss franc continued to strengthen, with the dollar losing a further 0.13% to 0.9869 franc, following a 0.6% slide. The benchmark 10-year U.S. Treasury yield was steady around 2.89% in Tokyo trading after dropping from as high as 3.015% in the prior session. Despite the pause in the safe haven rally, sentiment remained fragile with Asian stocks sliding and U.S. futures pointing lower, a day after a 4% drop for the S&P 500 and a 5% plunge for the Nasdaq. Poor U.S. housing data on Wednesday added to slowdown concerns, and Fed Chair Jerome Powell had ratcheted up the hawkish rhetoric the previous day by saying the U.S. monetary authority would push interest rates as high as needed to stem a surge in inflation that he said threatened the foundation of the economy. The euro recovered some ground, adding 0.25% to $1.0489 after Wednesday’s 0.84% slump. The Aussie rose 0.14% to $0.6965 - shaking off a smaller-than-forecast increase in jobs for last month - but the currency had slumped 1.05% on Wednesday. Sterling remained under pressure, trading little changed at $1.2343 after dropping 1.2% overnight as a surge in U.K. inflation to a 40-year record fostered worries for a sharp economic slowdown.