Indian Rupee: Recovers From 14- Month Lows

The Indian rupee commenced almost flat against the dollar in early trades on Thursday, 26 April 2018 and recovered from 14-month low seen in the previous session owing to fresh selling of the dollar by exporters and banks amidst higher opening in domestic equity market. Slight dollar weakness against other currencies overseas and a higher opening in the domestic equity market influenced the rupee uptrend.

The domestic currency rebounded to trade higher by 12 paise at 66.78 against the US dollar in opening session today. The rupee opened higher by 2 paise at 66.88 against the US dollar and was last seen trading at 66.8650 in the spot currency market. Yesterday, the domestic currency had tumbled 52 paise to hit a 14-month low of 66.90 against the US dollar, the third biggest single-day fall for the domestic currency this year, amid surging crude prices coupled with headwinds on the macro-economic front in form of widening trade deficit.

Domestic benchmark indices drifted higher in early trade. At 9:25 IST, the barometer index, the S&P BSE Sensex, was up 53.82 points or 0.16% at 34,555.09. The Nifty 50 index was up 16.05 points or 0.15% at 10,586.60. Overseas, Asian markets were trading on a mixed note. In US, the Dow Jones industrial average closed higher for the first time in six sessions on Wednesday, recovering from sharp losses seen earlier in the day, as Boeing soared on strong earnings.

Meanwhile, the dollar traded near a 3-1/2-month high against a basket of currencies on Thursday, bolstered by higher U.S. Treasury yields, led by the 10-year benchmark breaching the 3 percent threshold this week for the first time in four years. The dollars index against a basket of six major currencies was at 91.136 (DXY), having risen to a high of 91.261 on Wednesday, its strongest since Jan. 12.