Rupee opened higher, Dollar down vs. major currencies

Friday,   25-Sep-2020   10:45 AM (IST)

The Indian rupee opened the day higher at 73.7450/7550 levels compared to its previous close at 73.8950/9050 levels tracking rebound in Asian currencies and equities. Indian government bond yields trading higher ahead of weekly auction later today, and heavy state debt supply on Tuesday. Benchmark indices gained 1 per cent in Friday's opening deals, tracking similar trends in Asian indices. At 10:36 AM, the S&P BSE Sensex was trading at 36,906, up 353 point, while the broader Nifty50 was at 10,907 up 101 point. As per the technical indicators range for the USDINR pair may be 73.50-74.00 levels. Rupee has an immediate support at 73.85 levels. A breach of the same may see rupee at 73.95 followed by 74.14 levels. On the positive side rupee is likely to face resistance at 73.72 levels and if it is able to break the same then it may gain up to 73.63 levels followed by 73.45 levels.

The dollar was down on Friday morning in Asia, after earlier gains were reversed over lingering doubts about the latest U.S. stimulus package. Meanwhile, the Chinese Yuan was boosted by the inclusion of Chinese debt to FTSE Russell’s World Government Bond (WGBI) index. The U.S. Dollar Index that tracks the greenback against a basket of other currencies inched down 0.03% to 94.365. U.S. markets rose on Thursday over increased hopes that the U.S. Congress would break a months-long impasse to pass the latest COVID-19 stimulus measures. Democrats in the U.S. House of Representatives announced that they are working on a $2.2 trillion COVID-19 stimulus package that could be voted on next week. There is also a suggestion that House of Representatives Speaker Nancy Pelosi and U.S. Treasury Secretary Steven Mnuchin could resume stalled stimulus talks. But some investors remained skeptical on whether Congress will overcome the impasse. U.S. President Donald Trump refused to commit to a peaceful transfer of power should he fail to be re-elected in November’s presidential elections, increasing the chances of a disputed election. Meanwhile, data released on Thursday showed that the number of Americans claiming unemployment over the past week increased to 870,000, indicating a slowdown in the economic recovery and highlighting the pressing need for Congress to pass the support measures. The USD/JPY pair inched up 0.07% to 105.47. The USD/CNY pair was down 0.22% to 6.8123. The offshore Yuan reversed its decline over the past week after FTSE Russell’s announcement that Chinese government bonds will be added to the WGBI index starting in 2021.