Indian Rupee: Cautious Ahead Of GDP Data

Indian Rupee: Cautious Ahead Of GDP Data

Nov 27, 2020 08:11 IST capital market

The Indian rupee is expected to stay supported against the dollar owing to heavy buying in domestic equities and sustained foreign fund inflows and also persistent weakness in the greenback overseas. However, the currency could see restricted movement ahead of the July-September quarter GDP number that will be released later in the day.

On Thursday, rupee appreciated 3 paise to close at 73.88 against the US dollar. At the interbank forex market, the domestic unit opened at 73.85 against the greenback and witnessed an intra-day high of 73.75 and a low of 73.89. The local unit extended gains for the fifth consecutive day and finally closed at 73.88 against the American currency, registering a rise of 3 paise over its previous close. On Wednesday, the rupee appreciated by 10 paise to close at nearly a one-month-high of 73.91 against the US dollar.

Domestic equity indices bounced off days lows and ended with strong gains on Thursday. The S&P BSE Sensex, jumped 431.64 points or 0.98% at 44,259.74. The Nifty 50 index spurted 128.60 points or 1% at 12,987. Foreign portfolio investors (FPIs) bought shares worth Rs 2,027.31 crore, while domestic institutional investors (DIIs), were net sellers to the tune of Rs 3,400.10 crore in the Indian equity market on 26 November, provisional data showed.

Overseas, Asian stocks are trading traded little changed on Friday as investors react to data on Chinas industrial profits for October. Markets will also scrutinize concerns over the Oxford-AstraZeneca vaccine candidate, with results and methods used in their phase three vaccine trials under criticism from experts in the U.S. As the race for a coronavirus vaccine continues, questions are being raised over AstraZenecas vaccine candidate, for which the firm said combined results revealed it to be 70% effective. In US, financial markets were closed on Thursday for the Thanksgiving holiday and U.S. bonds and stocks will trade on a partial schedule on Friday.

Meanwhile, the dollar was down on Friday morning in Asia, holding steady amid small market moves. However, it looks set to see weekly losses as improved risk appetite continue to apply pressure. The US Dollar Index that tracks the greenback against a basket of other currencies inched down 0.03% to 91.983, hovering near a three-month low seen overnight.

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