Rupee falls back from a near 21-month high

Snapping a brief recovery, the home currency ended the week with a loss of 14 paise.

Mumbai: The rupee fell back from a near 21-month high against the US currency and ended lower at 64.38 on fresh bouts of dollar demand from importers and corporates amid shadowing global commodity crash.

Snapping a brief recovery, the home currency ended the week with a loss of 14 paise. This is the lowest closing in two weeks.

A massive rout in global commodity and oil prices took grip on trading sentiment even as traders preferred to stay on the sidelines and avoided taking and long positions amid fallout from Federal Reserve meet.

Sluggish local equities along with modest amounts of capital outflows too weighed on currency trade as foreign funds offloaded USD 88.29 million, according to provisional data from exchanges.

Trading was locked in tight ranges throughout the sessions amid uncertainty over the timing of an interest rate hike from the Federal Reserve. Maintaining its bullish momentum against the dollar, rupee resumed firmly higher at 64.12 against last Friday's closing value of 64.24 at the Interbank Foreign Exchange market (forex) here on the back of adequate dollar supplies.

It further gained strength to hit a fresh multi-year high of 63.9975 before sliding back under intese global volatility. Later, the home unit touched a low of 64.39 before ending at 64.38, showing a loss of 14 paise, or 0.22 per cent.

In worldwide trade, the US dollar ended the week trading at its lowest levels of 2017 despite positive macro ourtcome even as data showed US jobs growth rebounded sharply.

A burst of hiring in April provided reassurance for the U.S. economy after a slow start to the year as job growth returned to a healthy pace.

The FOMC on Wednesday left the door open to more gradual rate increases, starting in June, after strong US services sector growth kept hopes alive for a Federal Reserve interest rate increase in June.

The dollar index a measure of the US currency against a basket of six trade-weighted peers ended weak at 98.42 from last weekend level of 98.89.

( Source : PTI )
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