Rupee continues to strengthen for second-straight session

The Indian currency continued its strong gaining momentum for second straight day. Indian rupee ended higher against US dollar on Friday, on dollar selling by exporters and banks. The currency appreciation is positive for the overall sentiment of the markets. Strong currency and decline in crude oil prices will be key drivers for the markets going ahead.

The rupee sentiment was buoyed with report that Union Finance Minister Nirmala Sitharaman expressed that she is hopeful that the economy will start looking up in the second half of the current financial year as consumption rises and banks increase their lending operations. Traders also found some support with IHS Markit’s report that the steepest ever cut in tax that companies pay will improve relative competitiveness of India and should help boost corporate investment over the medium-term. On the global front, the euro held at its lowest level in more than two years on Friday as quarter-end rebalancing flows boosted demand for the dollar, with investors unfazed by the latest political news out of the United States.

Finally, the rupee ended at 70.56, 32 paise stronger from its previous close of 70.88 on Thursday. The currency touched a high and low of 70.93 and 70.53 respectively. The reference rate for the dollar stood at 70.90 and for the euro stood at 77.66 on September 26, 2019. While the reference rate for the yen stood at 65.87, the reference rate for the Great Britain Pound (GBP) stood at 87.67.