The rupee on Monday opened 17 paise lower at 71.50 against the US dollarNSE 1.16 % following buying in the American currency by banks and importers.

According to Motilal Oswal Financial Services, rupee remained under pressure on concerns of outbreak of the coronavirus and reports by CDC confirmed that a second case of the virus had been identified in the US.

China continued to take measures to contain the virus, extending travel restrictions. Meanwhile, more cases of the virus were reported outside China.

The dollar index traded positive after data from the US showed strength in the services sector offsetting a continued slowing in manufacturing to a three-year low. GBP meanwhile saw an extension of its losses as trade negotiations between the UK-EU begin after the UK leaves the trading bloc on January 31.

Safe haven currency Yen got supported by an uptick as the fear of the virus to bring a global slowdown supported the rally. For India, the main theme for markets would be the Union Budget and the expectations are high this time as market participants pin hopes for additional measures from the government to revive the economy.

On the data front, investors would also watch out for the US Fed and Bank of England’s monetary policy this week. US Fed interest rate decision is scheduled for Thursday. Also, the UK is set to exit the European Union by next week's January 31, 2020 deadline. Foreign investors bought net Rs 1,350 crore worth of equities on January 24. On a month-to-date basis, these investors are buyers of net $2.2 billion of domestic equities.

Published On : 27-01-2020

Source : Economic Times