Thursday, 1 August 2013

Indian Rupee Slips Back To Near Record Lows

The Indian rupee commenced lower on Wednesday, July 31, 2013 extending previous day decline as dollar firmed up against other currencies in overseas markets ahead of the US Fed concluding its policy meeting and a weak opening in the domestic equity market added further pressure on the domestic currency. Besides, heavy month-end demand for the US currency amid growth concerns also weighed on the local unit. The domestic currency opened weaker by 43 paise at Rs 60.91 to a dollar, edged up to a high of 60.83 before slumping back to a low of 61.21 so far during the day. In the spot currency market, the Indian unit was last seen trading at 61.02, down around 54 paise or 0.89% as compared to previous close at 60.48.Rupee fell below the key psychological level of 60 to the dollar to a three-week low on Tuesday, posting its biggest fall in a month, and wiping out all the gains notched up on central bank's recent liquidity tightening measures as RBI kept interest rates on hold and failed to announce any additional steps to defend the currency.
Domestic benchmark indices slumped in early trade as most Asian stocks fell as investors remained caution ahead of the Federal Reserve's policy decision. Asian shares were flat on Wednesday and the dollar held onto some slight gains as market momentum stalled ahead of the outcome of the U.S. Federal Reserve policy meeting and release of U.S. GDP data. At the time of writing, the S&P BSE Sensex was down 190.13 points or 0.98% to 19.158.21 while the CNX Nifty was down 53.80 points or 0.93% to 5,701.25.
The dollar struggled to extend modest overnight gains early in Asia on Wednesday as investors trod cautiously ahead of the outcome of the Federal Reserve policy review that could see the central bank drive home a dovish message. The euro steady above 1.32 to the dollar. The dollar index was around 81.80 levels. The dollar yen was at 98.

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Technical Comment For The Day: Copper

Copper recovered sharply and tested a one week high on the back of high liquidation of short positions. The open interest has dipped continuously in the last three sessions. The pickup in volumes to 71541 kgs, also justified that the rise in metal. MCX Copper August expiry contract closed at Rs 421.5 per kg, up 2.5%. Further rise of metal towards Rs 425 is highly likely in today's session. Earlier in the month, Copper has managed to test the resistance of Rs 425 but failed to surpass it. On LME, Copper was up by 1.6%, at $ 6920 per tonne. The next support for the contract is at $ 7000 per tonne.
Source by Commodity Insights