The Indian currency was eyeing gains for the week earlier in
the day before selling across global markets kicked off. It
ended flat week-over-week.
European and UK equities opened lower, with
banking shares leading the fall and the euro weakened
as Deutsche Bank's credit default swaps jumped sharply. The moves highlight just how frail sentiment remains after
the turmoil in the U.S. and European banking sectors in the past
two weeks, reviving memories of the 2008 global financial
crisis.
The dollar index jumped on safe-haven bids and the
offshore Chinese yuan fell further to 6.88 against the
U.S. currency to weigh on Asian peers.
USD/INR sustaining above 82.45 would negate our downward
bias, said Anindya Banerjee, head of research - FX and interest
rates at Kotak Securities.
It seems traders are not comfortable with their risk
exposures into the weekend as the moves in global markets have
shown we may not be out of the woods on these banking issues,
said a trader at a Mumbai-based bank.
Investors sought the safety of the bonds, with U.S. 10-year
yield falling 10 basis points (bps) to 3.30% and the
two-year down over 20 bps at 3.5844%. This added to moves sparked by expectations of a dovish
Federal Reserve this week. The probability of a pause at the May
meeting rose to 73%, with money markets expecting about 100 bps
worth of rate cuts this year. Markets now await the U.S. manufacturing and services PMI
flash estimate for March due later in the day.
(Reporting by Anushka Trivedi; editing by Eileen Soreng)
By Anushka Trivedi
MUMBAI, March 24 (Reuters) - The Indian rupee reversed
course to fall on Friday, erasing its weekly gains, as risk
sentiment worsened on worries over the health of the financial
sector in the United States and Europe.
The rupee closed at 82.48 per dollar, as compared
with Thursday's close of 82.2625.
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.