Rupee snaps 9-day losing streak, up 17 paise to 67.58/$

NEW DELHI: Snapping its biggest losing streak since 2007, the rupee rose 17 paise to 67.58 against the US dollar to put an end on its nine days of consecutive fall against the US dollar in early trade on Wednesday.

The domestic currency had on Tuesday fallen by 26 paise to end at a fresh two-and-a-half month low of 67.75 against the greenback on account of sustained demand for the US currency.

Better-than-expected home sales data in the US pushed dollar higher against key world currencies, raising concerns over a likely rate hike by the Fed in June. But the readings also offered a promising outlook for the world’s largest economy at a time when data points hint at deteriorating health of euro zone region.

Data showed new US home sales in the US saw biggest gain s in 24 years in April, touching a more than eight-year high as purchases increased broadly, a sign of growing confidence in the economy’s prospects, Reuters reported.

Dollar index (June futures) trading on the Intercontinental Exchange (ICE), which tracks the movement of greenback against a basket of six major world currencies, rose 0.39 per cent to 95.59.

Analysts feel that despite the firm US data releases of late, the Fed would not be in a hurry to hike rates.

“The US Federal Reserve is unlikely to increase interest rates any time soon, and any subsequent rate hike will depend on economic data points. Currently, US central bank is not anticipating any significant acceleration in economic growth. At BNP Paribas, we are forecasting that the US Fed will not increase interest rates in 2016. We have witnessed surge in emerging market flows with US Fed delaying the interest rate hike decision. We expect these flows into EMs are likely to sustain over the medium term,” Manishi Raychaudhuri , managing director and Asia Pacific Equity Strategist, BNP Paribas told the ET.