Rupee at three-month high, now at 70.09 against a dollar

Mumbai: The rupee rose to a three-month high against the US dollar on Thursday following a broad drop in US dollar against other currencies as well. The dollar slipped after dovish comments from US Federal Reserve Chair Jerome Powell, calming investor concerns over the pace of rate hikes. Indian equity market also rallied today with Sensex rising over 300 points.

At 9.15am, the rupee was trading at 70.09 a dollar, up 0.75% from its Wednesday’s close of 70.62. The currency opened at 70.17 a dollar. 

Overnight, Powell said that the Fed’s series of rate increases had brought the policy to “just below” the range of estimates of neutral. The comments spurred gains in US stocks and pushed down the dollar. 

The dollar index, which measures the US currency’s strength against major currencies, was trading at 96.789, up 0.01% from its previous close of 96.786.

Some points to note

• So far this year, the rupee has declined 8.9%, while foreign investors have sold $5.20 billion and $7.62 billion in the equity and debt markets, respectively.
   
• The rupee had hit a record low of 74.48 a dollar on October 11. Including today’s big gain, the rupee is up by about 6% against the US dollar from its record low.
   
• Fuelling this rebound in the rupee’s value against US dollar is the big fall in global oil prices.
   
• Asian currencies were trading higher on a whole. Indonesian rupiah was up 0.98%, South Korean won 0.4%, Philippines peso 0.27%, Japanese yen 0.27%, Taiwan dollar 0.19%, Malaysian ringgit 0.17%, China renminbi 0.16%, Singapore dollar 0.07%.
   
• The sharp fall in crude prices has eased concerns over India’s current as well as fiscal deficit. When petrol and diesel prices had touched a record high of Rs 84 per litre in Delhi, the government had to cut excise duty to cool prices
   

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