Rupee Opens Higher Against the Dollar Recovering From 18-Month Low

On Thursday morning, the Indian rupee was trading at 68.31 against the dollar around 10 am, 11 paise higher per dollar compared to Wednesday's close of 68.42, which was its 18-month low.

The rise in fuel prices and fund outflows from Indian markets dragged the domestic currency down yesterday to a new level since 29 November 2016 (68.65). Crude oil prices are also weighing in on the country's import bill, widening the current trade deficit.

Wearing out of optimism on global trade between US and China yesterday, impacted forex markets. American president Donald Trump said on Tuesday that he was not satisfied with his trade talks with China over the last weekend, however, he is hopeful to make further negotiations. He also said that his historic meeting with North Korean leader Kim Jong Un may not take place as scheduled on June 12. As a strong ally of China, the outcome of the meeting was connected and indicated that North Korea may not give up nuclear weapons.

US Federal Reserve policy meeting minutes showed that the central bank was dovish about the interest rates and did not accelerate it much despite economic growth. This weighed on the American currency.

Petrol and Diesel

As for crude oil, WTI (West Texas Intermediate) was at $71.61 per barrel, while Brent was at $79.50 per barrel. State-owned oil marketers in India also hiked fuel prices for the eleventh day in a row. Petrol price in Delhi is at Rs 77.47 per litre, Rs 80.12 per litre in Kolkata, Rs 85.29 per litre in Mumbai and Rs 80.42 per litre in Chennai.

Diesel, on the other hand, was revised to Rs 68.53 per litre in Delhi, Rs 71.08 per litre in Kolkata, Rs 72.96 per litre in Mumbai and Rs 72.35 per litre in Chennai.