Rupee recovers 5 paise to 64.58 a dollar ahead of GST rollout
Mumbai: The rupee today staged a mild recovery by gaining 5 paise to close at 64.58 against the US dollar in a cautious trade marked by a nervousness ahead of the Goods and Services Tax (GST) rollout.
Forex market sentiment remained little shaky initially as cautions ruled ahead of major domestic macro-data release even as the government looks all set to roll out the much- awaited GST regime at midnight tonight.
Intense foreign funds selling also kept the undertone volatile.
The rupee opened substantially lower at 64.72 from overnight closing level of 64.63 at the Interbank Foreign Exchange (Forex) Market on sustained bouts of dollar demand and drifted further sharply to hit a low of 64.84.
However, it bounced back sharply towards the fag-end trade and managed to close at session's high of 64.58, showing a smart gain of 0.05 paise, or 0.08 per cent.
The local currency witnessed a selling pressure in the last three trading sessions.
The RBI, meanwhile, fixed the reference rate for the dollar at 64.7379 and for the euro at 74.0019.
The local unit crumbled to hit a fresh one-month low of 64.84 in morning deals before staging a sharp U-turn.
Fresh selling of the greenback by banks and exporters as well as bearish dollar cues overseas predominantly helped the recovery momentum.
Domestic bourses also showed some strength today as both the key indices Sensex and the Nifty ended the day on a high note even as most Asian peers closed lower despite China manufacturing activity beating expectations.
Foreign portfolio investors (FPIs) sold shares worth a net Rs 1,140.77 crore yesterday, as per provisional data.
On the global front, the greenback languished near a nine-month low against a basket of currencies on Friday, bogged down by growing expectations of more hawkish monetary policies in Europe and Canada and doubts about another US interest rate increase this year.
The dollar index, which tracks the US currency against a basket of six major rivals, was down at 95.49.
In cross-currency trades, the rupee also bounced back against the pound sterling and settle higher at 83.79 from 83.83 per pound earlier.
But, it remained under pressure against the Euro and weakened further to 73.69 from 73.67 and also fell back against the Japanese Yen to end at 57.68 per 100 yens from 57.38 yesterday.
In forward market today, premium for dollar showed a mixed trend due to lack of market moving factors.
The benchmark six-month premium payable in November moved down to 121.75-123.75 from 121-123 paise, while the far forward May 2018 contract edged up to 267.75-269.75 from 266-268 paise on Thursday.
On the International commodity front, crude prices regained some lost ground as falling US production data bolstered market sentiment -- ending five weeks of losses.
US crude was trading up 0.2 per cent, or 8 cents, at USD 45.01 a barrel in early Asian trade, while Brent climbing 0.2 per cent, or 7 cents, to USD 47.49 a barrel.
Crude prices hit a 10-month low last week in the face of a mounting supply glut.
—PTI News
