Rupee ended higher, Pound rose vs. Dollar

Friday,   25-Sep-2020   02:43 PM (IST)

The Indian rupee ended the session higher at 73.61/62 levels compared to its opening at 73.7450/7550 levels after touching the high of 73.58/59 levels as regional equities and currencies rebounded after recent losses, while the dollar retreated from two-month highs. Rupee traded in the range of 73.58-73.77 levels today.  Indian government bond yields stayed higher amid weak demand at a debt auction and widespread expectations of devolvement of the benchmark paper. Benchmark indices were ruling nearly 2 per cent higher, on the back of across-the-board gains. At 2:08 pm, the S&P BSE Sensex was trading at 37,197, up 643 point, while the broader Nifty50 was at 10,993 up 188 point. In the forward segment 1mth, 3mth and 6mth annualized premia ended the day at 3.71%, 3.72% and 3.87% respectively.

Sterling rose against both the dollar and the euro on Friday as investors hoped Britain’s new scaled-back job support scheme will be followed by other stimulus measures. Finance Minister Rishi Sunak announced a new scheme to support jobs as COVID-19 cases surged again, but warned that the government will support only “viable” employment. Fears that unemployment will rise when the existing furlough scheme ends next month kept investors nervous as Sunak said it is impossible to save every job during an economic meltdown that is putting millions at risk of unemployment. But analysts are taking the view that more measures to help the coronavirus-battered British economy will ensue. The outlook for sterling remains bleak as talk of negative rates, the looming risk of a no-deal Brexit and new lockdown measures weigh down the currency. Bank of England governor Andrew Bailey did not exclude the possibility of negative rates, saying on Thursday that the BoE is seeking answers on the suitability of sub-zero rates. Prime Minister Boris Johnson told Britons to work from home where possible and ordered restaurants and bars to close early. The new measures could last for six months, he said. But the biggest threat to sterling remains the risk of the European Union and Britain failing to reach a Brexit trade agreement by the end of a transition period in December, according to analysts.