Rupee Strengthens, Bond Yields Ease on Peace Deal & Fed Outlook
By Sivam
Indian Rupee gains against USD, bond yields ease as Mideast peace deal lowers crude prices, despite hawkish US Fed outlook. FII inflows support.
Rupee Rises on Global Factors
The Indian rupee strengthened against the US dollar Thursday, gaining 12 paise to 94.38. This move was supported by falling global crude prices and FII inflows.
- The rupee traded at 94.38 against the US dollar, up 12 paise from its previous close of 94.50.
- This was largely driven by Brent crude falling below $78 per barrel after a reported US-Iran interim peace deal.
- Foreign institutional investors (FIIs) also turned net buyers, injecting Rs 101.59 crore into equities on Wednesday.
Bond Yields Ease Amid Fed Concerns
Yields on new 10-year Government Stock eased 03 basis points to 6.83%, down from 6.86%. Despite this, traders remain cautious after the US Federal Reserve held rates but projected higher rates by year-end.
- U.S. Treasury yields saw a slight rise Wednesday following stronger-than-expected May retail sales.
Oil Prices React to Mideast Accord
Oil prices declined as investors assessed the new US-Iran peace accord, which aims to restore traffic through the Strait of Hormuz. Concerns about a looming global supply surplus also contributed to the fall.