The rupee (INR) surged to a nearly two-and-a-year high of 63.44 against the US dollar, continuing its strength against the greenback in the New Year 2018. This is the highest value of the rupee against the US dollar since July 2015. On Monday, the rupee had kicked off the New Year on a bullish note by surging to 63.68 a dollar - a gain of 19 paise against its US counterpart. Globally, the US dollar fell against major currencies today. The rupee traded in the range of 63.76-63.48 against the US dollar. The rupee closed at 63.48 against the US dollar, with a gain 20 paise.
- Rupee hit a high of 63.44 vs dollar on Tuesday
- It is the highest level of the rupee since July 2015
- Rupee could rise to 63 in first quarter of 2018 vs USD, says IFA Global
5 things to know about the rupee's rise against the US dollar:
1) The US dollar today languished near a three-month low versus a basket of major currencies, as global markets reopened at the start of 2018. The dollar's index against a basket of six major currencies stood at 92.162. On Friday, it had slipped to as low as 92.080 - the weakest level since September 22.
2) Traders also said that increased selling of the American currency by banks and exporters lifted the rupee against the dollar.
3) For the whole of 2017, the US dollar index slid more than 9.8 per cent, the greenback's worst annual performance since 2003. The dollar (USD) retreated in 2017, partly because economic growth picked up outside the United States, with other countries' central banks moving towards tighter monetary policy, lessening the perceived divergence between the Federal Reserve and others.
4) The rupee had risen almost 6 per cent against the US dollar in 2017, buoyed by strong inflows into Indian capital markets. Besides, the dollar had also wilted against other global currencies.
5) In first quarter of 2018, rupee could be mildly positive against US dollar and may rise up to 63.00 levels, says forex advisory firm IFA Global. "But on back of global growth and stronger data, US Fed along with other central banks could move towards rate hike and balance sheet trimming. This can be seen capping the rupee's gains above 62.50 levels in remaining quarters or till end of 2018. Overall, our view remains positive for rupee in 2018," the forex advisory firm added.
(With agency inputs)