Rupee falls as global risk aversion rises

MUMBAI Fri Jul 18, 2014 5:20pm IST

A street side restaurant owner holds a bundle of currency notes as he sits outside his restaurant in New Delhi November 22, 2013. REUTERS/Adnan Abidi/Files

A street side restaurant owner holds a bundle of currency notes as he sits outside his restaurant in New Delhi November 22, 2013.

Credit: Reuters/Adnan Abidi/Files

Stocks

   

MUMBAI (Reuters) - The rupee fell to its weakest in a month against the dollar, tracking lower emerging market assets after the downing of a Malaysian airlines jet at the Ukraine-Russia border sent investors scurrying to defensive assets.

The rupee fell 0.7 percent for the week, posting its biggest weekly loss since mid-June when emerging markets had reeled on worries about the prospect of civil war in Iraq.

Global factors are likely to be the key drivers for the rupee next week, given the prospect of tensions between Russia and the West over the downed Malaysian commercial jet.

That could offset signs of improving economic fundamentals at home. Data on Monday showed consumer prices eased to their lowest since figures were first published in January 2012, while other data this month showed improving manufacturing activity and rising exports.

"The improving momentum in the manufacturing sector should be supportive of stronger earnings in the corporate sector and equity portfolio flows by implication," Sanjay Mathur, an economist at RBS said in a note to clients.

"At the same time, the strength of exports should allay concerns about INR overvaluation."

The partially convertible rupee ended at 60.28/29 per dollar, from its Thursday close of 60.18/19.

The rupee fell as low as 60.46 to the dollar at one point, a level last seen on June 18. But the currency pared losses as Sensex rose for a fourth straight session on Friday after better-than-expected earnings from Tata Consultancy Services Ltd (TCS.NS) sparked a rally in IT stocks.

In the offshore non-deliverable forwards, the one-month contract was at 60.47/57, while the three-month was at 60.97/61.07.

(Editing by Anupama Dwivedi)

Fast-tracking Projects

REUTERS SHOWCASE

Oil Prices

Oil Prices

Oil resumes slide after brief rebound on short-covering.  Full Article 

Space Programme

Space Programme

ISRO tests its heaviest space launch vehicle, eyes global market   Full Article 

Coal India Strike

Coal India Strike

Coal India workers threaten five-day strike, stokes output worries  Full Article 

Gold Discount

Gold Discount

Dealers offer gold discount for first time in five months  Full Article 

Lakhvi Granted Bail

Lakhvi Granted Bail

Pakistan court bails man accused of masterminding Mumbai attack  Full Article 

GST Bill

GST Bill

Cabinet clears bill for nationwide goods and services tax.  Full Article 

Aviation Sector

Aviation Sector

Breakingviews: SpiceJet rescue is no fix for India aviation woes.  Full Article 

Global Economy

Global Economy

Fed confident on U.S. growth, opens door wider to rate hike.  Full Article 

Reuters Poll

Reuters Poll

BSE Sensex to hit 32,980 by December 2015  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage