Indian Rupee bounces back on RBI measures to end on a strong note - ICICI Bank : Treasury Research

The Indian Rupee opened the day on a strong note, aided by the overnight measures taken by the RBI to check further losses in the currency. The RBI, late yesterday, announced the opening of a forex swap window to meet the entire daily Dollar requirements of three public sector oil marketing companies (IOC, HPCL and BPCL). Intraday, assurance by the Finance Ministry that fiscal implications of the National Food Security Bill in FY2014 are likely to be limited, also aided sentiment. In the latter session of trade, reported Dollar sales by PSU banks further aided gains in the Rupee. The USDINR pair ended the session at 66.55 vs. yesterday's close of 68.80.

The 6 and 12-month forward premia closed at 7.52% and 6.47% respectively compared to prior close of 8.29% and 7.30%.

The US Dollar is trading stronger amidst speculation that the Q2 GDP number would be revised upwards, indicating a firm pace of recovery in the economy. The Euro, meanwhile, is trading on the back of an unexpected rise in unemployment in Germany. The British Pound and Japanese Yen are also trading weaker on the back of broad-based Dollar strength. The Dollar index is currently at 81.83 compared to yesterday's close of 81.43. EUR/USD is hovering around 1.3257 vs. yesterday's close of 1.3340; GBP/USD is trading around 1.5509, vs. previous close of 1.5526. USD/JPY is trading around 98.21 compared to previous close of 97.64 (17:15 IST).

Source : Equity Bulls

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