The Indian rupee dropped lower by another 14 paise against the dollar in early trades on Wednesday, 18 April 2018, nearing a fresh seven-month low of 65.78 on fresh demand for the greenback from importers and banks. Concerns over oil prices, a global trade war threat, and the widening current account deficit have also weighed on the domestic unit.
The domestic currency commenced at Rs 65.6875 and fell sharply to a low of 65.7850 before recovering to a high of 65.6650 so far during the day. In the spot currency market, the Indian unit was last seen trading at 65.6675. Yesterday, the rupee had lost 15 paise to end at a near 7-month low of 65.64 against the US dollar amid persistent capital outflows and a fresh ripple of geopolitical tensions.
Stocks turned volatile as the key equity benchmark indices regained positive zone soon after hitting an intraday low in negative zone. At 10:25 IST, the barometer index, the S&P BSE Sensex, was up 8.83 points or 0.03% at 34,403.89. The Nifty 50 index was up 4.40 points or 0.04% at 10,553.10. Cement stocks rose. Telecom stocks saw mixed trend. Domestic stocks drifted higher in early trade tracking positive Asian stocks.
Overseas, Asian stocks rose as an encouraging US earnings season underscored resilient growth. US stocks rallied yesterday, 17 April 2018 amid better-than-expected earnings from industry heavyweights, adding to evidence that the strengthening economy is lifting corporate profits.
Meanwhile, the dollar edged up on Wednesday, as firm U.S. economic data supported the greenback against the yen and headline risks around U.S.-China trade relations and tensions in the Middle East appeared to take a backseat. The dollar index against a group of six major currencies was a shade higher at 89.538 (DXY) after gaining 0.1 percent overnight. The index had stooped to 89.229, its lowest since March 27 before pulling back on stronger-than-expected March U.S. housing starts and steady industrial production figures.