By Nimesh Vora
MUMBAI, March 16 (Reuters) - The Indian rupee declined
against the U.S. dollar on Thursday, tracking other major Asian
currencies, amid concerns over a European lender that dented the
already fragile risk sentiment.
The rupee was at 82.6800 to the dollar by 10:52
a.m. IST, compared with 82.5950 in the previous session. The
local currency had declined to 82.80, the lowest in two weeks.
Among major Asian currencies, the offshore Chinese yuan fell
to 6.90 to the dollar and the Korean won dropped 0.5%.
Over the last 6 months, USD/INR has been ranged with 83.00
acting a upper cap, Anindya Banerjee, head research - FX and
interest rates at Kotak Securities said.
"Positional traders, looking to short USD/INR can maintain a
stop above 83.05."
Asian shares and currencies resumed losses on fears of a
banking crisis in U.S. and Europe. Just when it seemed that risk
aversion over the collapse of U.S lender Silicon Valley Bank had
abated somewhat, investors had to deal with developments at
Credit Suisse.
The shares of the Swiss lender plunged on Wednesday after
its largest shareholder said it could not provide further
support to the lender. The Swiss central bank had to come to the
rescue to prevent a wider contagion.
European equities plunged on Wednesday, while near-maturity
bond yields jumped on bets that worries over financial stability
may prompt the European Central Bank to back off from raising
interest rates.
ECB policymakers meet on Thursday amidst the turmoil in
financial markets that could force it to divert from plans for a
50 basis points rate hike. Concern about Credit Suisse is adding to the SVB drama, with
financial stress indicators spiking higher, ING Bank said in a
note.
All this "adds unwanted excitement ahead of next week’s Fed
and today's ECB meetings".
(Reporting by Nimesh Vora; Editing by Varun H K)
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