Indian Rupeee near Rs. 60 mark - ICICI Bank : Treasury Research

The Indian Rupee had a gap-up opening of 90 paise, the highest since March 1993 and traded in the close proximity of the psychological 60 mark today. Downbeat global risk sentiment and broad based strength in the Dollar amidst speculation of tapering of QE by the Fed exerted strong downward pressure on the Rupee. Sell-off in other Asian peers, absence of FII inflows and losses in domestic stocks further weighed on the currency. However, the RBI has been seen intervening through state owned banks around 59.90 levels, which provided some support and helped the Rupee recover in later trade. The Rupee ended the day at a record low of 59.57, compared to yesterday's close of 58.71.

The 6 and 12-month forward premia closed at 5.90% and 5.62% respectively as against 5.75% and 5.49% yesterday.

The Dollar is trading higher, adding to the over 1% gains in yesterday's trade amidst broad based speculation of tapering of asset purchases by the Fed this year. The Euro is trading lower amidst downbeat global risk sentiment. A sub 50 reading of Eurozone manufacturing PMI, coming in at 48.7 in June, signalling continued contraction also weighed on the common currency. The Pound also traded lower on the back of significant Dollar strength. Positive UK retail sales reading, reporting 2.1% MoM rise in May as against 1.4% contraction in the prior month failed to provide much support to the currency. The Yen has fallen sharply owing to strength in the US Dollar. The Dollar index is currently at 81.92, higher than previous close of 81.43. EUR/USD is trading around 1.3201, compared to yesterday's closing levels of 1.3295; GBP/USD is trading around 1.5447 as against previous close of 1.5484. USD/JPY is trading around 97.96 compared to previous close of 96.45. (17:30 IST)

Source : Equity Bulls

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