Dollar edges up near 2-1/2-month high ahead of Fed outcome
The dollar edged closer to a 2-1/2-month high against a basket of currencies on Wednesday as traders awaited clues from the Federal Reserve about the timing of a U.S. interest rate increase.
A rate hike at the Fed’s two-day policy meeting which ends later on Wednesday is virtually priced out due to underlying concerns over a slowdown in China and the broader impact on global growth.
But many investors still expect the Fed to indicate that interest rates could rise as early as December. The index, which gauges the greenback against six rival currencies, stood at 96.958 , up about 0.1 percent from late U.S. trade and not far from a 2 1/2-month peak of 97.201 scaled on Friday.
Indian rupee ends at one-month low against US dollar, down 32 paise at 65.59
The rupee plunged by 32 paise against the US dollar to one-month low of 65.59 on fresh demand for the American currency from banks and importers amid persistent fall in equity markets coupled with strong foreign capital outflows.
The domestic unit opened lower at 65.39 as against last Friday’s level of 65.27 at the Interbank Foreign Exchange (forex) market and dropped further to 65.62 before ending at one-month low of 65.59, showing a loss of 32 paise or 0.49 per cent.
Sterling trades above $1.52, but lags euro on soft UK data
Sterling rose 0.4 percent against a struggling dollar on Tuesday, as investors fretted about when the U.S. Federal Reserve will raise interest rates amid growing doubts over a global recovery.
The International Monetary Fund (IMF) cut its global growth forecasts for a second time this year on Tuesday, citing weak commodity prices and a slowdown in China and said policies aimed at increasing demand were needed.
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We assume USD might depreciate and INR till 65.50