Rupee opened higher, Pound higher vs. Dollar

Friday,   11-Oct-2019   09:04 AM (IST)

The Indian rupee opened the day higher at 70.83/84 levels compared to its previous close at 71.07/08 levels as Trump’s positive comments on trade talks lifts Asian currencies and equities. Yuan advances 0.2% after Trump says trade talks going “really well” and that he will be meeting Vice Premier Liu He, who is leading the Chinese delegation to US. Indian government bonds fall in early trade ahead of weekly auction and as U.S. Treasury yields rise amid progress in U.S.-China trade talks. Equity market opened in the positive territory. At 9:25 AM, the S&P BSE Sensex was trading at 38,116, up 236 point, while the broader Nifty50 was at 11,310, up 75 point. As per the technical indicators range for the USDINR pair may be 70.60-71.15 levels. Rupee has an immediate support at 70.95 levels. A breach of the same may see rupee at 71.10 followed by 71.25 levels. On the positive side rupee is likely to face resistance at 70.79 levels and if it is able to break the same then it may gain up to 70.65 levels followed by 70.50 levels.

Hopes of progress in U.S.-China trade talks and optimistic comments from Europe on Brexit pushed back the safe-haven yen and lifted the British pound and euro early on Friday. Sterling was the biggest mover overnight, jumping 2% to a two-week high versus the dollar and posting its largest daily percentage gain in seven months on hopes of a Brexit resolution. Irish Prime Minister Leo Varadkar said on Thursday a Brexit deal could be clinched by the end of October to allow the United Kingdom to leave the European Union in an orderly fashion, after what he called a very positive meeting with Boris Johnson. Ireland is a major factor in the prolonged Brexit impasse. Sterling last traded at $1.2431, having risen up to $1.2469 on Thursday. Against the euro, the pound also rose to two-week highs of 0.8831 pound to the euro on Thursday and last stood at 0.8858. The euro also gained against the dollar, rising to $1.1007. It had climbed as high as $1.1034 in U.S. trade on Thursday, its strongest in almost three weeks. That helped to send the dollar index to 98.709, a low last seen on Sept. 25. Also undermining the dollar, data showed on Thursday U.S. consumer prices were unchanged in September and underlying inflation retreated, supporting expectations the Federal Reserve will cut interest rates in October. The yen eased to 107.92 yen to the dollar, having shed about 0.45% the previous day. Top U.S. and Chinese negotiators wrapped up a first day of trade talks in more than two months on Thursday, as business groups expressed optimism the two sides might be able to ease a trade war and delay a U.S. tariff hike scheduled for next week. U.S. President Donald Trump told reporters that his team had a "very, very good negotiation with China," and reiterated his plans to meet with Liu at the White House on Friday. The Chinese Yuan was also buoyed, with offshore Yuan traded at 7.105 Yuan per dollar, having hit a three-week high of 7.0990 to the dollar the previous day.