Dec 19 2018

Rupee Off Highs As RBI Likely Steps In; Fed Outlook Eyed

Financial Market Overview

19th December, 2018

Noon update

Indian Rupee:-

  • The Indian rupee was trading off highs on some greenback purchases by oil importers and banks, likely on behalf of the central bank. Earlier today, the local currency had risen to its highest in nearly three weeks against the dollar as crude oil prices crashed to a 14-month low.
  • The rupee changed hands at 70.13 to a dollar against 70.44 at close yesterday. The currency opened higher at 70.10 and rose above its key physiologically important level of 70, advancing to 69.85, its highest since Nov. 30.

 Indian Equities:-

  • Indian shares rallied tracking Asian shares and as financials and oil marketing companies continued to gain on consistent fall in crude oil prices.
  • The broader NSE index climbed 0.48% to 10,961.55, and the benchmark BSE index was 0.38% higher at 36,484.83.

 Global Markets:-

  • Asian markets finished mixed as of the most recent closing prices. The Hang Seng gained 0.11%, while the Shanghai Composite led the Nikkei 225 lower. They fell 1.05% and 0.60% respectively.
  • European markets are higher today. The DAX was up 0.21% while the FTSE 100 gained 0.30%. The CAC 40 was up 0.49% while IBEX35 gained 0.49%.
  • The Brent crude oil contract tumbled 5.6% yesterday to its lowest in 14-months and the U.S benchmark oil dropped 7.3% to end at its worst level since August last year. Recent output cuts by OPEC and its allies have not succeeded in halting the rout in the oil prices. Brent crude was last trading 0.57% higher at $56.58.
  • The dollar index declined 0.3% today after ending little changed overnight, ahead of the highly anticipated Fed outcome. An uncertain growth outlook, tumbling share prices, and falling bond term-yield premiums have prompted analysts, in recent weeks, to reassess the prospects of future Fed rate increases.
  • The Fed will almost certainly raise rates by a quarter percentage points later today, but its closely followed dot-plots is expected to shift policymakers’ projections for next year. Back in September, the Fed dot-plots showed the individual predictions of Fed members indicated three quarter percentage rate rises next year.