Rupee hits two month high of 66.67 against US dollar


The Indian rupee on Wednesday hit a two-month high against the US dollar, while 10-year bond yield hit a seven-year low, as foreign institutional investors (FIIs) continued to buy in local equity and debt markets.The rupee opened at 66.68 a dollar and touched a high of 66.67, a level last seen on 9 June. At 9.15am, the home currency was trading at 66.68 a dollar, up 0.24% from its previous close of 66.84.The 10-year bond yield hit a seven-year low and was trading at 7.107%, a last closing level seen on 24 September 2009, from its previous close of 7.124%.

Since 1 July till date, FIIs bought $2.25 billion in equity and $960.05 million in debt.

India’s benchmark Sensex index rose 0.29% or 81.62 points to 28,166.78. So far this year, it has gained 7.5%.So far this year, the rupee is down 0.8%, while FIIs have bought $5.21 billion in equity and sold $964.30 million in debt markets.The RBI left its key policy rate unchanged on Tuesday taking cognisance of the recent rise in inflation which puts the consumer price index uncomfortably close to the upper tolerance threshold of 6% as mandated by the government. The cash reserve ratio (CRR) was also kept unchanged at 4%.

On Tuesday, Rajan said that the Reserve Bank of India (RBI) has been front-loading liquidity provision through its open market operations and spot interventions or deliveries of forward purchases, in the wake of the expected pressure in FCNR (B) redemptions expected in September.He added that the RBI will continue to work to ensure that there are no market disruptions because of the redemptions through domestic liquidity operations and forex interventions.

Asian currencies gained. South Korean won was up 0.86%, Taiwan dollar 0.74%, Japanese yen 0.53%, Japanese yen 0.5%, Thai baht 0.32%, Singapore dollar 0.22%, Philippines peso 0.18%, China offshore 0.13%, China renminbi 0.13% and Indonesian rupiah 0.08%.The dollar index, which measures the US currency’s strength against major currencies, was trading at 95.768, down 0.43% from its previous close of 96.183.

190 total views, 1 views today