The rupee settled at 70.40 against 70.44 at the previous close. The
local unit moved in 69.85‐70.4750 per dollar band intra-day.
The Indian rupee rose for a third day to a near‐three‐week high
against the dollar, tracking an overnight slump in crude oil prices,
while investors awaited the U.S. FED decision on interest rates and
future guidance later today. Fall in crude oil prices strengthened the
rupee while inflows into local equities this month also helped it to
make gains. However, the rupee’s reversal may come after the Fed’s
outcome if it diverges significantly from what the market is expecting
in terms of a commentary and pace of future rate hikes.
Global Currency
The dollar fell on Wednesday as investors bet that the Federal
Reserve would signal plans to slow its pace of interest rate raises at a
keenly‐watched meeting later in the day. Fed policy makers are
widely tipped to raise rates for a fourth time this year but also to
express caution about future monetary tightening due to concern
about slowing global growth.
The euro was also supported by news that Italy had struck a deal
with the European Commission over its contested 2019 budget,
signalling an end to weeks of wrangling that had shaken financial
markets.
Global Markets
Oil stabilised on Wednesday after one of its biggest falls for years,
but remained under pressure from oversupply and concern that a
slowing global economy would depress demand for fuel. U.S. light
crude was 25 cents higher at $46.49, after plunging 7.3 percent in
the previous session when it touched its lowest since August 2017.
Gold prices climbed to a more than five‐month peak on Wednesday
as a softer dollar supported the bullion while investors awaited cues
on the rate hike trajectory of the U.S. central bank from its two‐day
policy meeting.
