The Indian rupee rose for the first time in three sessions against the dollar

The Indian rupee rose for the first time in three sessions against the dollar

14 Aug 2019 05:44 PM
 
The Indian rupee rose for the first time in three sessions against the dollar, as investors’ appetite for risk assets improved after U.S. delayed implementing tariffs on some Chinese goods. The rupee settled at 71.27 to a dollar, against 71.40 at previous close. The local unit opened at 71.00, and briefly rose to the day’s high of 70.86 before dropping to day’s low of 71.35 in late trade. Indian financial markets will be shut tomorrow for Independence Day.
Dollar bids in the market was mostly by state-run lenders for oil importers. Since risk of uptick in pair (USD/INR) lingers, importers will not want to lose on the opportunity to buy the pair on dips. The move in the local unit will remain restricted in the broad 70.50-71.50 band for the week.”

Global risk-off eased on the back of a de-escalation in the trade tiff between the U.S. and China. Yesterday, the Office of the U.S. Trade Representative, at the time of releasing the list of Chinese goods that would be subject to tariffs from Sep. 1. Trump had proposed earlier this month to levy a 10% tariff on $300 billion worth of Chinese imports. But after yesterday’s announcement by the U.S. Trade Representative, tariffs on more than half of the targeted imports will be delayed by more than two months. Asian equities ended higher, among which China’s Shanghai Composite settled 0.4% higher for the day, while the onshore yuan advanced 0.6% to 7.0558 to the dollar.

Meanwhile, reports indicated that top U.S. and Chinese trade officials spoke on the phone yesterday and more talks were planned in two weeks.

However, traders believe that U.S.-China trade talks are far from resolved yet and the continuing political unrest in Hong Kong limited any larger rise in Asian currencies. Asian currencies ended mixed. 

 

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