Analysis
Rupee closes weaker: Forwards marginally lower
After opening at 46.38/40, the Rupee traded weaker through the day on
good corporate Dollar demand. It touched a low of 46.45 to finally close
at a new low of 46.43/44 per Dollar. Corporate & FII Dollar demand
prompted the Rupee to slide to these levels. FII's have been net sellers
to the tune of $ 44.1 million in the stock market over the month.
Besides, the fall in Euro and other currencies has resulted in the
appreciation of rupee's value in REER terms and should keep the rupee
under pressure over the coming days. A cut in the RBI repo rate has
prompted forwards to slide with the bench mark six month closing at
4.34% p.a vs previous close of 4.35%.
Euro's woes continue: Yen strengthens
Negative economic fundamentals & continuous selling pressure kept
Euro on the defensive through the day. A half-yearly economic report
from Germany's six leading economic institutes confirmed suspicions that
Euroland was more vulnerable to rising oil prices than the US or Japan.
If the Euro receives no mention in the G-20 meeting, markets could be
more encouraged to test the Euro's downside. Talk of repatriation of
Japanese capital amid increasing volatility in the global financial
markets has led to USD/JPY slipping below 108.00 levels. GBP on the
other hand remained steady enjoying its safe haven status. |
