Rupee closes marginally higher against dollar

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Mumbai: The rupee on Monday erased all early losses to close marginally higher against the US dollar after some banks sold dollars on behalf of exporters.

The home currency closed at 66.57, up 0.1% from its previous close of 66.64. The rupee opened at 66.86 and touched a high and a low of 66.56 and 66.87 respectively.

There will be no bank transactions on 1 April due to the annual closure of accounts.

Traders are eyeing US non-farm payroll and unemployment data on Friday. A better-than-expected number will raise the possibility of a rate hike by the US Federal reserve in its April policy meet.

India’s benchmark Sensex index fell 371.16 points, or 1.46%, to 24,966.40 points. From 1 March to 22 March, foreign institutional investors (FIIs) bought $2.58 billion equities in the local markets, due to which stock markets gained 8.54%, or over 1,960 points. However, markets are still down 4.41% so far this year.

Since the beginning of this year, the rupee has lost 0.64%, while FIIs have sold $288.20 million from local equity and $889.60 million in debt markets.

Most Asian currencies closed mixed. The Malaysian ringgit was up 0.54%, South Korean won 0.28%, Singapore dollar 0.12%, Taiwan dollar 0.1% and China Offshore spot up 0.06%. However, Indonesian rupiah was down 0.73%, Japanese yen 0.4% and Thai baht 0.20%.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 96.307, up 0.04% from its previous close of 96.273.

Meanwhile, the 10 year bond yield closed over 32 month low ahead of the Reserve Bank of India’s bi-monthly policy meet on 5 April. Most of the analyst expects that the RBI may cut 25 basis points at the meeting.

India’s 10-year bond yield closed at 7.498%, a level last seen on 11 July 2013, compared with Wednesday’s close of 7.51%.