- Indian rupee trims initial losses, still down by 10 paise against US dollarIndian rupee to stabilise this year after 2013 slide on improved CAD despite US Fed taper: PollIndian rupee hits one-week low against US dollarIndian rupee ends flat at 62.07 vs US dollar after erasing initial losses
Indian rupee managed to build slightly on the gains that it scored against US dollar and Yen, but was flat against Euro and Pound. Indian rupee closed around 62:06/07 against the US dollar on spot after scoring a low of 61:98.
Some inflows were noted in the debt segment, on account of news of deferment of the debt switch, which was scheduled to happen on Q4. Exporter interest was thin and the decline in US dollar was mainly on account of inflows from foreign investors.
Economic news from Europe was encouraging as UK's trade deficit narrowed slightly in November, helped by a pickup in exports to recovering economies in Europe. At the same time, German industrial production rose for the first time in three months in November. Germany and UK continue to outshine other European economies. In Germany, the strong IIP follows on the heels of a robust factory orders growth and IFO business confidence data released previously.
Outlook: Tomorrow market will keep a close watch on November IIP from India as well as the December Merchandise external trade numbers. After our markets close, US December jobs data will be released. In the Indian rupee we can see the intra day volatility expand, as traders absorb the economic data flow. A range of 61:85 to 62:35 on spot can be seen tomorrow.
By Anindya Banerjee, currency analyst, Kotak Securities
NOTE: The views expressed are those of the author