The Indian rupee on Friday strengthened sharply in the opening after the European Central Bank (ECB) announced larger than expected measures to stimulate the region’s sagging economy.
The local currency opened at 61.45 per dollar and touched a high of 61.37—a level last seen on 5 November. At 9.12am, the rupee was trading at 61.41 per dollar, up 0.47% from its previous close of 61.71.India’s benchmark equity index, BSE Sensex, was trading at 29,187.93 points, up 0.63%.
Asian currencies were trading higher against the dollar. The Taiwan dollar was up 0.45%, Indonesian rupiah 0.30%, South Korean won 0.24%, Malaysian ringgit 0.22%, Philippines peso 0.18%, Singapore dollar 0.17%, Japanese yen 0.12%.
ECB president Mario Draghi announced an expanded stimulus plan and kept benchmark interest rates at record lows, boosting speculation flows of foreign capital into emerging-market assets will increase. The ECB will buy €60 billion worth of assets per month, more than markets had been hoping for, in a program that will last through September 2016, Reuters reported.
The yield on India’s 10-year benchmark bond stood at 7.693% compared with its Thursday’s close of 7.714%. Bond yields and prices move in opposite directions.
Since the beginning of this year, the rupee has strengthen 2.66% against the dollar, while foreign institutional investors have bought $782.5 million during the period from local equity markets and bought $2.36 billion from debt markets.
The dollar index, which measures the US currency’s strength against major currencies, was trading at 94.175, up 0.1% from its previous close of 94.077.Dealers likely to be cautious ahead of extra long holiday ahead. The markets are closed from Saturday to Monday.
Source:- livemint.com
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