Rupee just 10 paise away from 73-mark

Rupee just 10 paise away from 73-mark

Mumbai: The Indian rupee opened at a fresh record low and was trading just 10 paise away from hitting the 73-mark against the US dollar following advances in international crude oil prices and tracking losses in emerging currencies market. At 9.15am, the rupee was trading at 72.89 a dollar, down 0.25% from its Tuesday’s close of 72.70. The home currency opened at 72.75 per dollar and touched a low of 72.90.

The 10-year bond yield stood at 8.221%, from its previous close of 8.181%. Bond yields and prices move in opposite directions.

“It thus appears that the global factors have had a more important role to play for the depreciation of the rupee rather than the domestic factors like widening current account deficit, foreign investment outflows, rising inflation due to elevated crude oil prices”, said Care Ratings in a note to its investors.

“The benchmark GSec yields have been increasing on account of expectations of RBI turning more hawkish following the fall in the rupee besides rising inflation”, Care ratings added..

Moreover, traders are cautious ahead of key retail inflation and index of industrial production data due to be released after 5.30pm today. According to Bloomberg estimates, IIP will be at 6.5% for July from 7% a month ago. Retail inflation may come at 3.78% in August from 4.17% in July.

So far this year, the rupee has weakened 12.3%, while foreign investors have sold $538.20 million and $6.38 billion in equity and debt markets, respectively.

Benchmark Sensex Index rose 0.35% or 131.36 points to 37,544.49. Since January, it has gained 9.86%.

Asian currencies were trading lower. South Korean won was down 0.21%, Thai baht 0.15%, China offshore 0.14%, Singapore dollar 0.12%, Malaysian ringgit 0.08%. However, Japanese yen was up 0.14% and Indonesian rupiah 0.05%.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 95.154, down 0.1% from its previous close of 95.249.

source: livemint