Indian Rupee closes lower on Friday - ICICI Bank : Treasury Research

The Indian Rupee opened the session on a weak note, weighed by broad-based strength in the US Dollar. Intraday, the currency remained under pressure amidst heavy Dollar demand by PSU banks, with the Rupee even breaching the 61- mark intraday. However, reported Dollar sales by PSU banks on behalf of the RBI in the latter session of trade helped limit the extent of losses. The USDINR pair ended the session above the 61- level at 61.10 vs. yesterday's close of 60.43.

The 6 and 12-month forward premia closed at 8.76% and 7.87% respectively compared to prior close of 8.56% and 7.66%.

The US Dollar is trading firm amidst speculation that the non-farm payrolls data due later today would signal an improvement in US labour markets, thereby raising bets of an early tapering of QE. The Euro is trading largely flat, holding on to previous session's losses following the ECB's largely dovish rhetoric in yesterday's policy meeting. The Yen is also trading weak. The Pound however, is trading stronger after UK's July construction PMI topped consensus and recorded the highest reading in mid-2010, indicating a firm recovery in the economy. The Dollar index is currently at 82.44, compared to the previous close of 82.34. EUR/USD is hovering around 1.3206, same as yesterday's close; GBP/USD is trading around 1.5153 as against previous close of 1.5120. USD/JPY is trading around 99.81 compared to previous close of 99.54 (17:00 IST).

Source : Equity Bulls

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