Indian rupee on Friday weakened marginally against the US dollar tracking losses in its Asian peers.
The Indian currency opened at 69.13 a dollar. At 9.12 am, the domestic currency traded at 69.12, down 0.11% from its previous close of 69.04.
Government bond yields rose in six out of eight trading sessions after news reports said the Prime Minister’s Office (PMO) was opposed to the proposed sovereign bond sale in foreign currencies.
The yield on the 10-year government bond was at 6.538% compared with Thursday's close of 6.511%.
News agencies Reuters and Cogencis, and CNBC-TV18 reported, citing an unnamed government official that Prime Minister Narendra Modi’s office does not favour a forex-denominated overseas sovereign bond issuance. This comes a day after finance secretary Subhash Chandra Garg was transferred to the power ministry. The report said the PMO favored rupee-denominated overseas sovereign bond issuances.
Analyst said the market was expecting dollar issuance to replace domestic borrowing, but now there is confusion on whether the government will go ahead with the sale.
Earlier, former governors of Reserve Bank of India had criticized the idea arguing it could create long-term economic risks by exposing the government's liabilities to currency fluctuations.
The benchmark equity index Sensex was up 0.2% at 37831.18 points. So far this year, the index has risen 4.89%.
The rupee has risen 0.94% against the greenback in the year so far. Foreign investors bought $9.27 billion in Indian equities and $2.70 billion in the debt market during the period.
Asian currencies were trading lower as traders await next week’s US Fed review, as well as data on US jobs and manufacturing. South Korean won was down 0.28%, Indonesian rupiah fell 0.24%, Malaysian ringgit declined 0.14%, Philippines peso lost 0.1%, China renminbi and China offshore were down 0.08% each, Thai Baht fell 0.07%, and Singapore dollar lost 0.06%.
The dollar index, which measures the US currency’s strength against a basket of major currencies, was at 97.785, down 0.03% from its previous close of 97.818.
Published On : 26-07-2019
Source : Live Mint
