Indian Rupee dips due to weak Asian shares and regional stocks – The partially convertible Indian Rupee dips on Tuesday due to weak and low Asian shares and regional stocks and a stronger dollar overseas soured sentiment. According to 0355 GMT, at 9:25 AM, the Indian Rupee INR=IN was at 46.63/64 per dollar, 0.4% beneath its Monday’s close of 46.465/475.
Dealers have stated that they would wait for the local share market open for further direction. According to them, some month-end dollar was also seen in the market. In the local currency market, one of the biggest buyers of dollars is Oil CLc1, i.e. India’s largest import and refiners. The dollar demand from importers and refiners inclines to optimum at the end of each month, when they make payments.
The head of global markets at IndusInd Bank, Mr. J. Moses Harding commenced in a daily note that, “We continue to watch the rupee within 46-47 in the short term. This range will hold good till EUR/USD trades within 1.4750-1.5050 while the stock market trades in consolidation mode within 16,500-17,500″.
In addition he stated, “The strategy for importers would be to buy 12-month dollars on overshoot to 47.00-47.25 while exporters to sell 12-month receivables at 48.25-48.40″. The dollar has cut down losses on Tuesday as Tokyo stocks failed to follow up a stronger day on Wall Street, motivating few to purchase the dollar back and as some investors closed dollar short positions before the Thanks giving holiday.
Against 6 majors, the index of the dollar .DXY was up by 0.2%. Most of the Asian units were weaker as compared to the dollar. At 0355 GMT, Nifty India stock futures SINc1 traded in Singapore were marginally lower whereas the MSCI index .MIAPJ0000PUS of Asian stocks ex-Japan was low by 0.5%.
Indian shares .BSESN are intended to open flat to lower tracking weak Asian markets, though the losses are likely to be bounded as cash-rich foreign funds look for investment. In the early March, foreign buying of more than $15 billion worth of local shares has helped in lifting the rupee off a record low of 52.2 hit and continues to be a key factor driving the rupee. Besides this, 1 month offshore non-deliverable PNDF forward contracts were quoted at 46.64, a bit changed from the on shore spot rate.
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