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Rupee turns lower after early gains

16 Jan 2020 Evaluate

Indian rupee weakened against the US dollar on Thursday. Earlier the rupee was strengthened by tracking positive global cues as easing tensions between the United States and China improved investor sentiment. The United States and China signed a Phase 1 trade deal on Wednesday and pledged to resolve their longstanding tariff dispute that has roiled financial markets in the recent years. The first phase of the trade deal includes Intellection Property (IP) Protection and Enforcement, ending forced technology transfer, dramatic expansion of American agriculture, removing barriers to American financial services, ending currency manipulation, rebalancing the US-China trade relationship and effective dispute resolution. Meanwhile, US President Donald Trump said he would remove all US tariffs on Chinese imports as soon as the two countries complete the Phase 2 trade agreement, on which negotiations will start soon. Foreign fund inflows and gains in domestic equity markets too supported rupee sentiment and capped its losses. Foreign institutional investors (FIIs) bought shares worth Rs 279.53 crore on Wednesday, exchange data showed.

The partially convertible currency is currently trading at 70.86, weaker by 4 paise from its previous close of 70.82 on Wednesday. The currency touched a high and low of 70.8800 and 70.7500 respectively. The reference rate for the dollar stood at 70.92 and for Euro stood at 78.98 on January 14, 2020. While the reference rate for the Yen stood at 64.43, the reference rate for the Great Britain Pound (GBP) stood at 92.13.

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