May 05 2018

Rupee posted 4th weekly decline against US Dollar

 Weekly Synopsis

 

Date:- 05th May 2018

 

Markets from 30th April 2018 to 04th May 2018:-

 

Indian Rupee:-

 

  • Indian rupee posted a fourth weekly decline against the dollar despite a holiday-truncated week, dragged by aggressive greenback demand from oil importers that overshadowed an overnight sell-off in the dollar index and gains from easier norms for foreign investment in local bonds. On a weekly basis, the rupee lost 0.30% against the dollar. The rupee closes on Friday at 66.86 against the previous weekly close of 66.66 on April 27th, 2018 to a greenback. It trades in a weekly range between 66.9250 to 66.52 against the greenback.

 

  • India’s foreign exchange reserves fell for a second consecutive week to $420.37 billion as of the week ended Apr. 27, against $423.58 billion hit in the previous week, the central bank said yesterday. Friday’s decrease was due to a fall in foreign currency assets to $395.28 billion from $398.49 billion in the previous week, according to data from the Reserve Bank of India.

 

  • India’s annual infrastructure output growth slowed to a three-month low of 4.1 percent in March from a year ago, government data showed on Tuesday. The growth in output compares with an upwardly revised 5.4 percent year-on-year growth in February.

 

Global Market:-

 

  • The dollar retreated from 2018 highs amid weaker than expected U.S. labor market data but losses were limited as expectations for a Federal Reserve June rate hike remained intact. The US Dollar Index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose by 0.12% to 92.39. The greenback rose to its highest level in 2018 after hitting an intraday of 92.75.

 

  • The U.S. economy created 164,000 in April, above the 135,000 jobs created in March, according to a report released Friday by the U.S. Department of Labor. But that missed economists’ forecast for 189,000. The jobless ratefell to 3.9%, beating economists’ forecasts for a 0.1% decline to 4%. Average hourly earnings grew 0.1%  for April, below expectations for a 0.2% increase.

 

  • Initial claims for state unemployment benefits rose 2,000 to a seasonally adjusted 211,000 for the week ended April 28, the US Labour Department said on Thursday. Claims dropped to 209,000 in the prior week, which was the lowest level since December 1969.

 

  • The Federal Reserve left interest rates on hold on Wednesday, as widely anticipated, but signalled that inflation was nearing its 2% target, lining up a further rate hike at its next meeting in June. The Federal Open Market Committee kept the overnight funds rate unchanged at 1.75% to 2.0% at the conclusion of its two-day policy meeting.

 

  • Inflation in the euro zone slowed in April, according to a flash estimate released on Thursday, underlining the case for the European Central Bank’s caution in removing stimulus measures. The bloc’s statistics agency Eurostat said its consumer price index fell to 1.2% in April from the same month a year earlier, compared to expectations for a reading of 1.3%.

 

  • Eurostat said the euro area economy grew by an annualized 2.5% in the three months to March. That was down from 2.7% in the fourth quarter and in line with estimates. The economy expanded by 0.4% in the first quarter.

 

  • Activity in the UK service sector picked up slightly last month, but remained subdued according to a closely watched business survey released on Thursday. Research firm Markit said its services purchasing managers’ index rose to 52.8 in April, compared to forecasts for a reading of 53.5.

 

  • The Dow Jones Industrial Average rose 332.36 points, or 1.39 percent, to 24,262.51, the S&P 500 gained 33.69 points, or 1.28 percent, to 2,663.42 and the Nasdaq Composite added 121.47 points, or 1.71 percent, to 7,209.62.

 

Local Market:-

 

  • Indian shares ended lower on Friday, snapping a straight run of five weekly gains, tracking global cues with drugmakers and information technology counters weighing on sentiment.

 

  • The benchmark BSE index closed down 0.53 percent at 34,915.38, slipping 0.2 percent for the week. The broader NSE index ended 0.57 percent lower at 10,618.25 and closed the week with a 0.7 percent fall.