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Rupee hits 5-month high vs US dollar, then erases gains

Staff Reporter
The rupee today traded in the range of in the range of 69.24 to 69.78 against the US dollar

The rupee today rose to a six-month high against the US dollar amid firm domestic equity markets and a weakening of the US dollar in overseas markets. The rupee today opened at 69.42 a dollar and rose to a 69.24 at day's high. It was trading at 69.67 in afternoon trade. On Friday, the rupee had ended higher by 48 paise at 69.72 against the US dollar in line with smart gains in domestic equities and uptrend in other emerging market currencies. So far in the day, the rupee traded in the range of 69.24 to 69.78 against the US dollar. Meanwhile, domestic equity markets traded on a firm note, with Sensex rising nearly 300 points.

5 things to know about rupee vs dollar value today

1) The US dollar today weakened against the its peers after Fed Chairman Jerome Powell sought to ease market concerns about the risk of a slowdown, saying on Friday that the central bank would be patient and flexible in policy decisions this year. Global risk appetite got a huge boost when the US payrolls report showed 312,000 net new jobs were created in December, while wages rose at a brisk annual pace of 3.2%.

2) “Good hard data coupled with an indication of fewer hikes cheered investors with US equities rallying and treasuries selling off. US dollar weakened across the board except against safe haven JPY,” forex advisory firm IFA Global said in a note.

3) The rupee is likely to trade in the range of 69.20-69.60 against the US dollar in the near term, says IFA Global. It sees rupee in the range of 68.50 - 72.50 in three months.

4) The US dollar softened broadly with the euro edging up to $1.1428 and the dollar index eased 0.2% to 95.971. The currency could not even hold early gains on the yen, lapsing back to 108.05.

5) Asian equity markets rode a relief rally today on expectations that face-to-face trade negotiations between delegates from Washington and Beijing, due to start on Monday, would lead to an easing in tensions between the two biggest economies in the world. Oil prices rose by more than 1% today, lifted by optimism that talks could soon resolve the trade war between the US and China, while supply cuts by major producers also supported the market. Brent crude futures were at $57.75 per barrel.

(With Agency Inputs)