Mumbai: The rupee weakened on Friday, tracking Asian currencies, as the dollar rallied on indications from central banks in Europe that ultra-low rates will continue in the region.
The rupee opened at 60.06 per dollar and strengthened to 60 in early morning trade, but then fell to an intra-day low of 60.55. At 2:25pm, the rupee was at 60.52 to the dollar, 0.55% down from Thursday’s close of 60.13.
Heads of the European Central Bank and the Bank of England signalled on Thursday that a rate hike in their respective economies will be bad for the recovery in the region.
This leaves the US Federal Reserve as the sole institution that can wind up stimulus spending in the developed world which, according to Federal Reserve chairman Ben Bernanke, may happen starting December should the US economy show signs of a sustained recovery.
However, the US recently lowered its first-quarter growth figure to 1.8% from 2.4% earlier, dimming the chances of such a rollback.
The dollar index, which measures the greenback’s strength against major global currencies, was up 0.86% to 84.94 points at 2pm Indian local time. All Asian currencies weakened on Friday, except the Philippine peso and the Taiwanese dollar, which were marginally up against the dollar.
Technical charts for the rupee show the exchange rate could go to 61.50 per dollar. The local currency touched its all-time low of 60.73 a dollar on 26 June.
