The Indian rupee commenced lower on Monday, October 29, 2012, returning back after a long holiday weekend and remained muted as investors stay cautious ahead of the Reserve Bank of India’s policy review on Tuesday. The domestic currency opened weaker by 25 paise at Rs 53.82 to a dollar and dropped further to a low of 53.88 before edging up to a high of 53.78 so far during the day. Moreover, euro losses seen early in Asia weighed on the local unit, limiting gains from a positive domestic share market. In the spot currency market, the Indian unit was last seen trading at 53.84, off intraday highs and down by around 27 paise or 0.51% as compared to previous close at 53.57.
The European unit dipped lower early today, having regained some of its losses over the weekend. The euro was at $1.2929, recovering from today’s early dip of $1.2914 and a two-week low of $1.2881 hit on Friday. The single currency has been trading in a broad range between $1.28 and $1.31, waiting for bailout prospects for struggling Spain and Greece to become clear.
Meanwhile, on the local grounds, benchmark indices edged higher in early trade after Prime Minister Dr. Manmohan Singh announced a major reshuffle of his Council of Ministers on Sunday. Asian stocks erased gains Monday after the open of Hong Kong trading as developers fell following the city’s decision to impose its first property tax targeting overseas buyers. Domestic investors await the Reserve Bank of India (RBI) Second Quarter Review of Monetary Policy – 2012-13 tomorrow, 30 October 2012.