Indian Rupee: Extends Decline As Dollar Holds Firm Overseas

The Indian rupee extended its decline against the dollar in early trades on Thursday, 10 May 2018 to hit a fresh 15-month low due to appreciation of the American currency overseas amid sustained foreign capital outflows and soaring global crude prices. The dollar held firm against a basket of currencies overseas after the 10-year US bond yield rose back to the psychologically important 3 per cent mark. However, a higher opening in the domestic equity market capped some of the losses.

The rupee opened at Rs 67.35 against the dollar and plunged to a low of 67.4375 so far during the day. In the spot currency market, the Indian unit was last seen trading at 67.4075. The rupee had closed 19 paise lower at a 15-month low of 67.27 yesterday against the US currency following a surging demand for the dollar as crude oil prices zoomed past USD 77 per barrel level.

Domestic benchmark indices were trading higher in early trade, tracking positive Asian stocks. At 9:19 IST, the barometer index, the S&P BSE Sensex, was up 146.91 points or 0.42% at 35,466.26. The Nifty 50 index was up 33.35 points or 0.31% at 10,775.05. Overseas, Asian shares were trading higher, tracking Wall Streets advance as oil prices traded higher after touching multi-year highs overnight. In US, the broader stock market rallied as sharp gains in energy, financials and technology stocks propelled the main benchmarks firmly higher.

Meanwhile, the dollar remained steady against other major currencies on Thursday in Asia as U.S. 10-Year Treasury yields climbed above 3% again on Wednesday. The U.S. dollar index that tracks the greenback against a basket of six major currencies last stood at 92.95, up 0.01%. The greenback reached this years new high on Wednesday at 93.22, then slipped back below the 93 level on Thursday.