Indian Rupee: Edges Lower Post An Initial Recovery

The Indian rupee recovered slightly against the dollar on Tuesday, 17 April 2018 on fresh selling of the greenback amid a higher opening of domestic equities. A weak dollar against other currencies overseas also supported the domestic unit. Rupee, however, erased early gains to weaken further thereafter.

The domestic currency opened at Rs 65.45 against the dollar and dropped to a low of 65.54 so far during the day. In the spot currency market, the Indian unit was last seen trading at 65.52. Yesterday, the rupee had fell by 29 paise, or 0.44 per cent, to close at a six-month low of 65.49 against the US currency on widening trade deficit concerns amid heightened geopolitical worries.

Overseas, Asian stocks were trading mixed as investors parsed a mixed set of economic numbers out of China and sought fresh leads after weeks of volatility sparked by trade frictions and geopolitical conflict. US stocks closed sharply higher yesterday, 16 April 2018 with major indexes rallying in a broad advance as the first-quarter earnings season pointed to strong growth and geopolitical tensions showed signs of easing.

In the meantime, the dollar remained steady in Asia on Tuesday late morning as Syrias situation improved. Investor risk appetite revived amid easing geopolitical tensions as more strikes at Syria seemed unlikely. The market shifted focus to economic data from China, the worlds second largest economy, on Tuesday and the high-level trade talks between the U.S. and Japan this week to look for cues. The U.S. dollar index that tracks the greenback against a basket of six major currencies steadied at 89.14 at 11:00PM ET (03:00 GMT).