The rupee settled at 72.89 against 72.49 at the previous close. The local unit moved in 72.72-73.07 per dollar band intra-day.
The Indian rupee fell for the first time in three sessions against the dollar, as the dollar index rose to a more-than-16-month high amid bets of faster pace of U.S. interest rate hikes after robust economic data in the world’s biggest economy. The speculators in the market are holding the long dollar view, since the data released so far in the world’s largest economy is only adding to faster pace of rate hike bets that will also keep dollar index firm in coming days.
Global Currency
The dollar rallied to a 16-month high on Monday as investors positioned for a Federal Reserve interest rate rise next month and concern about political risks in Europe put pressure on the euro and the pound. The dollar fell last week on the belief that losses for U.S. President Donald Trump's Republican party in the midterm elections would make further fiscal stimulus measures unlikely.
The euro was knocked back by concerns about Rome's tussle with the European Commission over its 2019 budget & weakness in Italy's banking sector. The single currency slid 0.7 percent versus the dollar to its lowest since June 2017 at 1.124. Fears about a no-deal Brexit & growing rift in Europe over Italy's budget have also aided the dollar.
Global Markets
Oil rose by more than 1 percent on Monday, set for its largest one-day increase in a month after Saudi Arabia said OPEC and its partners believed demand was softening enough to warrant an output cut of 1 million barrels per day.
Gold prices fell to their lowest in one month as the dollar strengthened amid expectations that the U.S. Federal Reserve is on track to tighten borrowing costs.
