While the Rupee has been on a firmer footing against the US Dollar for much of the week, overnight the emerging market asset shed recent gains as improved optimism regarding the situation in the US shored up the ‘Greenback’ at the expense of its higher-risk rivals.
The US Dollar to Indian Rupee Exchange Rate was in the region of 62.0600 as of 11:30 GMT
Although the Rupee’s declines were limited as yesterday’s strong trade data continued to offer the currency support, news that US lawmakers are getting closer to reaching a compromise which would allow the government to reopen and a default to be averted saw the Rupee slide to 62.215.
The release of minutes from the Federal Open Market Committee’s most recent policy meeting, which intimated that tapering will begin this year, also had an impact.
As currency expert Paresh Nayar comments; ‘The US is driving the world economy and so they are unlikely to not reach an agreement. So the Dollar is showing some strength.’
Similarly one New York-based strategist noted; ‘The FOMC minutes appear to have given a boost to the Dollar as markets focus on the key headline that most FOMC members see tapering by the end of the year. Positions against the Dollar have been vulnerable for a while and are starting to unwind.’
The US Dollar to Rupee (USD/INR) exchange rate hit a low of 61.8200
Rupee weakness was also limited as an official within India’s Economic Advisory Council asserted that the nation’s current-account deficit for the year to March 2014 could be below the Finance Ministry’s estimate by as much as 14 per cent.
That being said, the Rupee also lost ground against the Euro and Pound as the local session progressed.
While US news could provoke further Rupee fluctuations in the hours ahead, investors will also be waiting for the release of India’s manufacturing output and industrial production reports, taking place tomorrow.
Current Rupee (INR) Exchange Rates:
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The Pound Sterling/ Indian Rupee Exchange Rate is currently in the region of: 98.9174 >
The Euro/Indian Rupee Exchange Rate is currently in the region of: 83.6944 >
The US Dollar/Indian Rupee Exchange Rate is currently in the region of: 62.0600 >
The Australian Dollar/Indian Rupee Exchange Rate is currently in the region of: 58.5474 >
The New Zealand Dollar/Indian Rupee Exchange Rate is currently in the region of: 51.2078 <
The Canadian Dollar/Indian Rupee Exchange Rate is currently in the region of: 59.7305 >
(Correct as of 11:30 GMT)
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