Business

Rupee snaps 4-day rally on U.S.-China tensions

Stronger dollar weighs on local unit

The rupee ended its four-day rally as weakness in domestic equities spilled over to the currency market, pushing the domestic unit 64 paisa lower against the dollar to close the day at 75.73.

The rupee opened weaker at 75.70 compared to the previous close of 75.09. It hit the day’s low of 75.80 before closing at 75.73, down 64 paisa from Thursday’s close.

According to dealers, renewed trade tensions between the United States and China weighed on the currency apart from a strengthening dollar.

“The greenback surged following safe-haven buying as uncertainty increased after U.S. President Donald Trump threatened to impose new tariffs on China,” said Sugandha Sachdeva, VP-metals, energy and currency research, Religare Broking. The dollar index, that gauges the greenback’s strength against a basket of six currencies, rose 0.27% to 99.35.

“Going ahead, sentiments remain weak and fresh concerns that trade tensions could delay an economic recovery are likely to weigh on the local unit.Rupee is likely to gyrate in the range of 75.20 and 76.60 in the near term,” said Ms. Sachdeva.

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Printable version | Jun 3, 2020 6:48:54 AM | https://www.thehindu.com/business/rupee-snaps-4-day-rally-on-us-china-tensions/article31504252.ece

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