Rupee Recovers 8 Paise To Close At 67.42 Against US Dollar. 10 Points

Press Trust of India

12 Jun 2018, 08:18 AM IST

The RBI fixed reference rate for dollar at 67.3353 and for the euro at 79.5230.

The rupee touched a high of 67.28 in early trade before giving back some gains. Though, the overall forex mood remained cautiously ahead of the key central banks monetary policy decisions particularly the Federal Open Market Committee (FOMC). The Fed is set to raise the interest rate on Wednesday after the FOMC Meeting minutes from the May meeting consisted of the words "it will be appropriate to raise rates soon," leaving no room for doubts.
Currency traders await cues from the macroeconomic data to be released later this week -- including IIP, CPI and WPI along with movement of crude oil prices.
On the energy front, crude prices slipped a day after entering bull market, largely pulled down by rising Russian production and the highest US drilling activity in more than three years, but supported by concerns over future Iranian and Venezuelan output.
Indian bond markets witnessed selling after a brief recovery and the 10-year benchmark bond yield settled higher at 7.96 per cent.
Foreign investors and funds poured in more than Rs 2,200 crore in the Indian equity markets in the last six trading sessions on the back of easing of global crude oil prices and revival in corporate earnings.
Country's forex reserves declined by $593.7 million to $412.23 billion for the week ended June 1 on a dip in the gold assets, Reserve Bank said.
The rupee opened with a mild positive bias as 67.48 from last weekend close of 67.50 through the early session at the interbank foreign exchange (forex) market. It extended gains against the dollar in mid-afternoon deals on greenback sales by foreign banks, likely on behalf of their custodian clients.
After hitting a session's high of 67.28, the local unit struggled to sustain on momentum and succumbed to some fresh downward pressure towards the fag-end trade before ending 67.42, still showing a gain of 8 paise, or 0.12 per cent.
The RBI, meanwhile, fixed the reference rate for the dollar at 67.3353 and for the euro at 79.5230. The dollar index, which measures the greenback's value against a basket of six major currencies, was up at 93.58. In the cross currency trade, the rupee also recovered against the pound sterling to end at 90.03 per pound from 90.40 and also bounced back against the Japanese yen to finish at 61.30 per 100 yens as compared to 61.75 earlier.
In forward market today, premium for dollar showed a weak to steady trend owing to lack of market moving factors. The benchmark six-month forward premium payable in October softened to 109-111 paise from 109.50-111.50 paise, while the far-forward April 2019 contract finished stable at 252-254 paise.