The US Dollar Index (DX) strengthened around 0.4 percent on Monday, on the back of weak sentiments in the global markets which boosted demand for the low-yielding dollar. Decline in the Euro due to rising concerns over Euro Zone debt crisis also acted as a further supportive factor for the DX.
The index touched an intra-day high of 79.57 and closed its trading session at the level of 79.30 yesterday.
Dollar/INR
The Indian Rupee (INR) witnessed depreciation of around 0.4 percent on Monday, on the back of weak sentiments in the global markets which also hurt domestic equities. Nifty and Sensex dropped sharply by more than 2 percent each yesterday. Additionally, dollar strength also acted as a negative factor for the currency on Monday. The INR touched an intra-day low of 49.80 and ended its trading session at the level of 49.59 yesterday.
Outlook
We expect the US dollar to weaken today, as the consumer confidence data from the US is expected to come on a positive note which could boost the sentiments in the global markets at the end of the trading session. On account of this, we expect the Indian Rupee to trade with an appreciation bias today.
Courtesy: SMC Global
