Rupee opened lower, Dollar marginally weaker vs. major currencies

Monday,   18-Feb-2019   09:06 AM (IST)

The Indian rupee opened the day lower at 71.31/32 levels compared to its previous close at 71.22/23 levels as India’s January trade deficit widens from previous month. India’s trade deficit stood $14.73 billion in January, up from $13.08 billion in previous month. Indian government bonds fall in early trade with benchmark 2028 yield at near two-week high, as crude oil extends gain. Benchmark indices opened on a flat note even as positive Asian markets that rose on US-China trade talks. At 9:30 AM, the S&P BSE Sensex was trading at 35,665, down 144 points, while the broader Nifty50 was at 10,691, down 33 points. As per the technical indicators range for the USDINR pair may be 71.10-71.65 levels. Rupee has an immediate support at 71.50 levels. A breach of the same may see rupee at 71.60 followed by 71.75 levels. On the positive side rupee is likely to face resistance at 71.15 levels and if it is able to break the same then it may gain up to 71.05 levels followed by 70.95 levels.

The dollar was marginally weaker on Monday, as increasing expectations of a U.S.-Sino trade deal led investors to shift away from the safety of the greenback into riskier assets. Both the United States and China reported progress in five days of negotiations in Beijing last week, although the White House said much work remains to be done to force changes in Chinese trade behavior. Negotiations will continue next week in Washington as investors hope for an end to the trade war between the world's two largest economies. In Asia, the yen was marginally higher versus the greenback at 110.53. The Aussie gained 0.1 percent to $0.7144, after gaining 0.48 percent on Friday on hopes of a trade breakthrough between the United States and China. The kiwi dollar also gained around 0.1 percent on the dollar to $0.6868. U.S.-China trade tensions have kept markets highly volatile since last year. U.S. duties on $200 billion worth of Chinese imports are set to rise from 10 percent to 25 percent if no deal is reached by March 1 to address U.S. demands that China curb forced technology transfers and better enforce intellectual property rights.