Rupee opened lower, Dollar weaker vs. Yen

Friday,   15-Feb-2019   09:04 AM (IST)

The Indian rupee opened the day lower at 71.23/24 levels compared to its previous close at 71.16/17 levels as Brent crude climbs to fresh near three-month highs. Brent crude +0.5% to $64.88, headed for fourth day of advance. Benchmark indices opened on a flat note today taking cues from the Asian market that slipped following fears of slowing US economy. At 9:30 AM, the S&P BSE Sensex was trading at 35,805, down 72 points, while the broader Nifty50 was at 10,722, down 24 points. Indian government bonds fall in early trade as crude oil prices continue to gain, with Brent contract rising over $65 per barrel mark for the first time in three months. As per the technical indicators range for the USDINR pair may be 70.85-71.50 levels. Rupee has an immediate support at 71.38 levels. A breach of the same may see rupee at 71.50 followed by 71.75 levels. On the positive side rupee is likely to face resistance at 71.00 levels and if it is able to break the same then it may gain up to 70.85 levels followed by 70.70 levels.

The dollar weakened against the yen on Friday as dismal U.S. retail sales data reinforced expectations Federal Reserve rates will not rise this year, while investor focus shifted to trade talks between Washington and Beijing. Retail sales posted their largest decline since September 2009, U.S. data showed on Thursday, a sign of weakness in the consumer sector, which accounts for more than two-thirds of the economy. The dollar lost about 0.5 percent against the safe-haven yen in the overnight session and was relatively unchanged in early Asian trade. The yen rose marginally versus the euro to 124.67, having gained around 0.2 percent on Thursday. The Aussie and New Zealand dollars pared earlier gains, losing 0.2 percent to $0.7091 and $0.6819, respectively. The dollar index, a gauge of its strength versus six major peers was relatively unchanged at 97.01, after weakening by 0.12 percent in the previous session. The main focus for the Asian market on Friday remains the outcome of the high level trade talks between U.S. and China this week. Markets earlier this week cheered U.S. President Donald Trump's upbeat assessment of the talks. White House economic adviser Larry Kudlow said the administration's top two negotiators will meet on Friday with Chinese President Xi Jinping but that there had been no decision to extend a March 1 deadline for a deal. Bloomberg had earlier reported that Trump is considering a six-day extension of the deadline. U.S. tariffs on $200 billion worth of imports from China are scheduled to rise to 25 percent from 10 percent if the two sides don't reach a deal by then, increasing pain and costs in sectors from consumer electronics to agriculture. Elsewhere, sterling was down 0.1 percent at $1.2800. Traders expect the pound to remain volatile in the coming weeks. British Prime Minister Theresa May suffered a defeat on her Brexit strategy on Thursday that undermined her pledge to European Union leaders to get her divorce deal approved if they grant her concessions. The United Kingdom is on course to leave the European Union on March 29 without a deal unless Prime Minister Theresa May can persuade the bloc to amend the divorce deal she agreed last year.