Rupee extends losses against dollar tracking share falls; month-end demand aids
The rupee-dollar pair was trading at 61.55/56 versus Thursday's 61.34/35 close. The
pair touched 61.62 earlier, its strongest since August 8. Month-end demand from
importers and fall in local shares aided the pair. Foreign fund flows were seen as the
key for direction. Nifty was trading down 0.5 per cent. Traders expect good
resistance for the pair around 61.60 holding it in a 61.35 to 61.65 range for the rest
of the day.
Dollar holds near 4-year highs, European equities slip
The dollar held near a four-year high against a basket of currencies on Friday,
fuelled by the biggest yield advantage over the euro in nearly 15 years as the Federal Reserve contemplates hiking interest rates. European equities fell to trade close to a one-month low as a sharp sell-off in US and Asian markets prompted caution among investors on the last trading day of the week. US stocks ended sharply lower on Thursday as Apple Inc tumbled after the tech giant withdrew an update to its new operating system and as the dollar rose to a four-year high. The dollar index, which tracks the greenback against a basket of major currencies, edged up about 0.1 per cent to 85.278, not far from a four-year high of 85.485 hit on Thursday. The dollar is on track for its 11th successive weekly rise, something it has not achieved in four decades. "Its Friday and so we may see some consolidation but in general the dollar has broken through a number of long-term levels so there's scope for us to go further before we meet much resistance," said Neil Mellor, a strategist with Bank of New York Mellon in London. "Against the euro we have a forecast in the low $1.20s for a year's time, but the way things are going we could get there fairly quickly." It has been driven by the divergent monetary policy outlooks between a rate-hike contemplating Fed while the Bank of Japan and the European Central Bank are
mulling further stimulus. The yield difference between 10-year US Treasuries and German Bunds reached its widest in nearly 15 years on Thursday, keeping pressure on the euro. High bond yields tend to attract more fund inflows as bond investments account for a big chunk of international capital flows. The euro was steady on the day at $1.2746, after falling as low as $1.26955 on trading platform EBS on Thursday, its lowest since November 2012.
fuelled by the biggest yield advantage over the euro in nearly 15 years as the Federal Reserve contemplates hiking interest rates. European equities fell to trade close to a one-month low as a sharp sell-off in US and Asian markets prompted caution among investors on the last trading day of the week. US stocks ended sharply lower on Thursday as Apple Inc tumbled after the tech giant withdrew an update to its new operating system and as the dollar rose to a four-year high. The dollar index, which tracks the greenback against a basket of major currencies, edged up about 0.1 per cent to 85.278, not far from a four-year high of 85.485 hit on Thursday. The dollar is on track for its 11th successive weekly rise, something it has not achieved in four decades. "Its Friday and so we may see some consolidation but in general the dollar has broken through a number of long-term levels so there's scope for us to go further before we meet much resistance," said Neil Mellor, a strategist with Bank of New York Mellon in London. "Against the euro we have a forecast in the low $1.20s for a year's time, but the way things are going we could get there fairly quickly." It has been driven by the divergent monetary policy outlooks between a rate-hike contemplating Fed while the Bank of Japan and the European Central Bank are
mulling further stimulus. The yield difference between 10-year US Treasuries and German Bunds reached its widest in nearly 15 years on Thursday, keeping pressure on the euro. High bond yields tend to attract more fund inflows as bond investments account for a big chunk of international capital flows. The euro was steady on the day at $1.2746, after falling as low as $1.26955 on trading platform EBS on Thursday, its lowest since November 2012.
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