Mumbai: The Indian rupee on Tuesday weakened marginally against the dollar after India’s current account deficit (CAD) widened. The fall in local stock markets also muted sentiment. The rupee ended at 61.89 per dollar, down 0.08% compared with its previous close of 61.84. India’s benchmark equity index, S&P BSE Sensex, closed at 27,797.01 points, down 1.15%. India’s CAD widened to a five-quarter high of 2.1% of gross domestic product (GDP) in the second quarter ended September, as exports growth slowed and imports increased because of a rise in demand for gold. Most of the Asian currencies ended higher against the dollar.
The South Korean won rose 0.89%, Japanese yen was up 0.58%, Indonesian rupiah was up 0.48%, Malaysian ringgit up 0.34%, Thai Baht up 0.19%, while the Philippines peso rose 0.22%. The China offshore spot declined 0.41% and China renminbi was down 0.27%. The yield on India’s 10-year benchmark bond ended at 7.903% compared with its Monday’s close of 7.918%. Bond yields and prices move in opposite directions. Intra-day, bond yield fell to 7.891%—a level last seen on 15 July 2013.
Since the beginning of this year, the rupee has weakened 0.14% against the dollar, while foreign institutional investors have bought $17.36 billion during the period from local equity markets. The dollar index, which measures the US currency’s strength against major currencies, was trading at 88.887, down 0.18% from its previous close of 89.041.
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