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Rupee opened tad higher, Dollar up vs. major currencies

Wednesday,   30-Sep-2020   10:56 AM (IST)

The Indian rupee opened the day tad higher at 73.8125/8225 levels compared to its previous close at 73.8525/8625 levels tracking range bound Asian currencies, after “fairly neutral” first U.S. presidential debate. Indian government bond yields largely unchanged as investors await release of 2H borrowing calendar later today. Equity markets are trading higher in Wednesday's early deals after making a flat start, on the back of mixed global cues. At 10:40 AM, the S&P BSE Sensex was trading at 38,108, up 135 point, while the broader Nifty50 was at 11,271 up 49 point. As per the technical indicators range for the USDINR pair may be 73.50-74.10 levels. Rupee has an immediate support at 73.91 levels. A breach of the same may see rupee at 74.04 followed by 74.21 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 73.59 levels followed by 73.45 levels.

The dollar was up on Wednesday morning in Asia, with investors digesting economic data from China as well as the presidential debate between U.S. President Donald Trump and Democrat Joe Biden. The U.S. Dollar Index that tracks the greenback against a basket of other currencies inched up 0.05% to 93.977. However, gains were capped by month and quarter-end currency flows. The debate, the first of three scheduled in the run-up to the presidential election on Nov. 3, saw Trump and Biden chaotically debate issues such as Trump’s leadership, the COVID-19 pandemic, the economy and taxes. But investors could not decide on a winner, with neither candidate scoring a decisive advantage. Investors are also focusing on the U.S. Congress’ progress towards passing the latest $2.2 trillion fiscal stimulus bill proposed by Democrats on Monday, after U.S. House of Representatives Speaker Nancy Pelosi said on Tuesday that a deal with the Trump White House could be possible by this week, with further talks scheduled with Treasury Secretary Steve Mnuchin later in the day. However, some investors were not optimistic that the bill would be passed by Congress in its current form. The USD/JPY pair edged down 0.12% to 105.52. The USD/CNY pair inched down 0.05% to 6.8119. Chinese purchasing managers indexes (PMIs) for September, released earlier in the day, stayed above the 50-mark separating growth from contraction and showed the Chinese economy’s continued recovery from COVID-19's impact. Although the manufacturing PMI was 51.5, beating the forecast 51.2 and August’s 51 readings and the non-manufacturing PMI was 55.9 against August’s 55.2, the Caixin manufacturing PMI of 53 was slightly under the forecast 53.1 and August’s 53.1 figures. The AUD/USD pair edged down 0.13% to 0.7117, while the NZD/USD pair inched up 0.03% to 0.6588, with an ANZ Bank survey showing that New Zealand business sentiment improved in September as COVID-19 numbers in the country remain low. The GBP/USD pair edged down 0.17% to 1.2839. Although the pound initially saw gains as hopes for a Brexit deal with the European Union (EU) rose on Tuesday, Bank of England governor Andrew Bailey’s stated openness to introducing negative interest rates if needed saw the gains reversed.