Rupee ended lower, Pound edges lower vs. Dollar

Friday,   03-Dec-2021   04:12 PM (IST)

The Indian rupee ended the session lower at 74.1625/1725 levels compared to its opening at 74.98/99 levels after touching the low of 75.1750/1850 levels in a thin-volume session, with traders eying the upcoming U.S. jobs report to assess the outlook for the upcoming Federal Reserve meeting later this month. Rupee traded in the range of 74.9575-75.1750 levels. Asian currencies and equities were mixed. Traders also continue to remain focused on the impact of the Omicron coronavirus mutation, after India became the thirtieth nation in the world to report cases of the new variant. Indian federal government bond yields settled marginally higher this week, after falling for two straight weeks, as investors awaited next week's monetary policy decision, with the focus being on the normalisation path that the rate-setting body adopts. The key benchmark indices reversed their two-day winning streak with losses in excess of a per cent. Index heavyweight Reliance Industries, banking and FMCG shares were responsible for a significant amount of the losses. The BSE benchmark index, the Sensex ended with a loss of 765 points at 57,696. The NSE Nifty settled 205 points lower at 17,197. In the forward segment 1mth, 3mth and 6mth annualized premia ended the day at 3.47%, 3.74% and 4.65% respectively. 

Sterling edged lower on Friday as the potential for earlier Federal Reserve interest rate hikes strengthened the dollar overnight, although pandemic uncertainties continued to weigh on the broader forex market. The dollar leapt against its more risk-sensitive Australian and New Zealand counterparts ahead of crucial U.S. jobs data that could clear the path to earlier Federal Reserve interest rate hikes. Sterling fell 0.2% to $1.328, within striking distance of its lowest level since December 2020 hit on Tuesday. Against the euro, the pound edged 0.15% lower to 85.07 pence. A survey by the BoE, which is weighing up whether to raise interest rates, showed British companies are struggling to find the staff they need and expect higher inflation in the year ahead. Some analysts said press reports that the U.S. was to delay trade talks with the UK over post Brexit concerns regarding the Northern Ireland protocol might add further uncertainty to the pound. A U.S. administration official on Thursday said the country's failure to remove tariffs on UK steel and aluminium has no connection to concerns about post-Brexit trade rules affecting Northern Ireland.