Rupee today: Domestic currency fell at 82.73 per dollar
The rupee on Tuesday reversed earlier gains in the session to ease slightly against a softer dollar as the Chinese yuan hit a 15-year low on concerns that Xi Jinping’s new leadership team has stood by its loyalists, China will give more priority than the state. Private Sector.
While the domestic currency was initially driven by an easier dollar on bets from the less hawkish US central bank, the rupee’s appeal was limited in a holiday-shortened trading week after the Chinese yuan fell.
Bloomberg showed that the rupee was last turning around at 82.73 per dollar after opening at 82.65 on Friday, compared to its previous close of 82.6850 on Friday.
Last week, the rupee hit a new record low, falling to 83.29 per dollar, driven by concerns of an aggressive monetary tightening agenda. However, the Reserve Bank of India stepped in to stop the bleeding and brought the rupee below the 83 mark.
Indian financial markets were closed on Monday and will remain closed on Wednesday for Diwali celebrations and thus, may limit capital flows in thin trade.
The rupee moved in a range of 82.58 to 82.79 during the day, when volumes were low due to holidays in many parts of India, and Asian currencies were down against the dollar,” said Anil Kumar Bhansali, head of treasury at Finrex Treasury Advisors.
“The dollar index was at 112.01, almost unchanged, and oil was also stable. The only change was in the Chinese yuan, which touched around 7.36, keeping the rupee weakening,” he said.
The offshore yuan fell to a new low of $7.3650 after the People’s Bank of China’s daily fix raised hopes that the central bank might allow a market-determined exchange rate, and mainland stocks found it difficult to maintain stability. .
“The conflict between Beijing’s security and economic (development) objectives has deepened,” Vishnu Varthan, head of economics at Mizuho Bank in Singapore, told Reuters.
“The cleanup of the Politburo Standing Committee by Xi loyalists, and the apparent absence of technical experts more likely to focus on spurring the economy, suggests that economic revival policies may be subordinated,” he said. Told.
The Hang Seng was last down 0.1 percent, indicating Asia-wide weakness in the yuan and a spreading China outlook.
South Korea’s victory fell to a 13-year low on Tuesday. Indonesia’s first strong rupiah has lost its sheen, while the Vietnamese dong is falling for the second time in a month despite rising 100 basis points.
The yuan also fell to its lowest level in more than a year against a basket of currencies of its trading partners, according to a Bloomberg gauge.
Officials are allowing the yuan to adjust after trying to cap it during a party congress, “and the question is how far it will let the yuan go,” Khoon Goh, head of Asia research at the Australia and New Zealand banking group, told Bloomberg. “A weakening yuan will have some spillover effect on other Asian currencies.”
The dollar was somewhat weaker, and the euro strengthened ahead of a rate hike anticipated by the European Central Bank later this week.
Sterling also found some support in the hope that the new prime minister, Rishi Sunak, would bring stability.
The price of gilt rose after Rishi Sunak won easily for the Conservative Party leadership on Monday.
“While the premiums associated with September’s reckless fiscal policy actions have been removed, it does not take us back to a neutral outlook on sterling,” Adam Cole, chief currency strategist at RBC Capital Markets, told Reuters.
“Britain’s structural imbalances existed prior to those policy changes, and they are still a long-term concern,” he said.