The rupee settled at 71.45 against 71.5525 at the previous close. The
local unit moved in 71.30-71.76 per dollar band intra-day.
The Indian rupee recouped early losses to end at a near-one week
high against the dollar, after the nation’s rate-setting panel
unexpectedly cut its key policy interest rate that lifted local assets,
while announcing steps to boost dollar inflows. Rupee reacted
positively to the policy outcome because rate cut is beneficial to the
local stock market and corporates, which helps in bringing in foreign
inflows in the country. Limit for FPI’s and relaxation of the use of ECB
proceeds too helped the local currency. The RBI’s reserves numbers
also suggest that it is restocking after the recent fall in the reserves.
Global Currency
The euro fell to a two-week low on Thursday after the European
Commission sharply cut its forecasts for economic growth in the
euro zone. Complicating the European Central Bank's plans for an
interest rate hike this year and weakening the single currency. The
euro has lost around 1.3 percent over the last week as investors bet
the ECB will keep monetary policy accommodative faced by low
inflation in the single currency area.
Sterling GBP was marginally lower at $1.2914. Pound has weakened
by 1.3 percent in February due to Brexit woes. The UK is on course to
leave the EU on March 29 without a deal unless British PM Theresa
May can convince the bloc to reopen the divorce agreement.
Global Markets
Oil steadied on Thursday as growing expectations that global supply
could fall significantly short of demand this year lent support,
offsetting the negative impact of a rise in U.S. inventories.
Gold was trading close to a more than one-week low on Thursday
weighed by a stronger dollar but uncertainties around the Sino-U.S.
trade spat and concerns about slowing global growth supported the
metal above the key $1,300 level.
