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Rupee Rises 17 Paise To 82.70 Per Dollar



Rupee Rises 17 Paise To 82.70 Per Dollar

Rupee Today: Domestic currency gains against a softer dollar

The rupee regained some ground on Monday, stalling a two-session losing streak as the dollar slipped against a basket of currencies, and hopes of a demand recovery in China helped boost Asian currencies.

After falling in the previous two sessions, the domestic currency was last changing hands at 82.7025 per dollar, compared to its previous close of 82.8687 on Friday, according to Bloomberg.

PTI reported that the Indian currency rose 6 paise to close at 82.69 against the US dollar provisionally.

“The rupee remained in a range of 82.55 to 82.85 as the RBI supported it near the 82.80/90 levels, and a fall in Brent oil to $ 79.23 per barrel released some of the pressure on the rupee. Asian currencies gained from lows, too,” said Anil Kumar Bhansali, Head of Treasury at Finrex Treasury Advisors.

Still, global recession concerns linger, and the mood isn’t improving as we approach the year’s end due to softening economic data.

According to surveys published this week, economic activity in Europe, Japan, and America shrank in December. In line with this decline, China’s business confidence has reached its lowest point since the World Economics Survey began accumulating data in January 2013.

Festive cheer was muted by the prospect of future interest rate increases, as indicated by major central banks.

Last week, the Federal Reserve and European Central Bank (ECB) announced more interest rate increases. The Bank of Japan (BOJ), which meets on Monday and Tuesday, is pondering changing its current ultra-dovish stance.

A report published on Saturday by the news agency Kyodo claims that Japan intends to change its 2 per cent inflation target policy, potentially giving the central bank more flexibility.

A shift in the BOJ’s ultra-loose monetary policy, which increased the yen’s value on Monday, could result from a revision to a joint statement between the Japanese government and the BOJ about the latter’s inflation aim.

“Where there’s smoke, eventually there is fire,” Rodrigo Catril, a Strategist at National Australia Bank in Sydney, told Reuters.

“This sort of news we’re getting plays to this view that the government will open the door for the BOJ to have a more flexible approach,” he said, “and that some of this uber-undervaluation of the yen can be reversed.”

The main cause of the yen’s 15 per cent decline against the dollar this year, which has made it the worst-performing G10 currency, is the interest rate difference between rising US and stable Japanese rates.

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