The Indian rupee snapped a two-day rise to end beyond the psychologically key 46 per dollar mark on Tuesday as local stocks took a beating on growing risk aversion towards emerging markets by foreign investors. But central bank intervention helped cushion a sharp sell-off in the Indian rupee, traders said.
The partially convertible rupee ended at 46.03/0375 against the dollar, down 0.23 percent from Monday's close. It hit a three-year low of 46.57 on May 31 and has lost nearly 2 percent since May 11, when the stock market peaked.
"Overall sentiment was subdued due to the sell-off in other Asian and emerging markets," said a trader at a state-run bank. "There were dollar purchases by oil companies and we think the rupee could ease more if the dollar continues to rise abroad."
Asian currencies hit fresh multi-month lows on Tuesday, hurt by renewed risk aversion in global markets and nagging worries about higher US interest rates. A broad sell-off in Asian share markets also added to the bearish sentiment.
Asian stock markets were lower following a sell-off on Wall Street after Federal Reserve officials kept up their tough talk on inflation on Monday, bolstering expectations for another rate rise at the Fed's meeting later this month. The dollar hit a one-month high against the euro on Tuesday as investors bought the US currency on growing expectations of a US rate increase.
Comments
Comments are closed.