Rupee eases four paise against US currency

MUMBAI: The Indian rupee eased further by four paise to 42.94/94 against the US currency in morning trade on Monday on fresh month-end dollar demand amid steady equity markets.
At the Interbank Foreign Exchange market (forex), the local currency resumed lower at 42.90/92 a dollar from its last weekend's close of 42.88/89 a dollar and later moved down further to 42.92/94 a dollar in late morning trade.
Dealers said oil companies were seen making dollar purchases at the month-end for their import payments. Global oil prices neared USD 142 a barrel in Asian trade this morning, pushed up by continued worries about supplies and weak US dollar.
Asian equity markets, including Indian bourses showed narrow movements in morning trading on Monday.

Yen lifted by Moody's upgrade

major currencies in Asian trade Monday after Moody's upgraded Japan's domestic debt rating on hopes of continued fiscal reform and an economic recovery, dealers said.
They said the euro was slightly higher against the dollar ahead of an expected interest rate rise by the European Central Bank this week.
The dollar dropped to 105.65 yen in Tokyo afternoon trade from 106.11 in New York late Friday. The euro fell to 167.03 yen from 167.22 but firmed to 1.5794 dollars from 1.5790.
Traders bought the yen after Moody's Investors Service upgraded Japan's local-currency government bonds by one notch to Aa3, the fourth-highest rating, Jun Kato, a senior dealer at Shinkin Central Bank, told Dow Jones Newswires.
Sentiment towards the dollar also "does not look great" following last week's US economic indicators, Kato said.
The market was looking ahead to Thursday's ECB decision, with a 25-basis-point interest rate rise to 4.25 pc expected in response to simmering inflation.
Markets will be looking for clues from ECB chief Jean-Claude Trichet on the future direction of rates in the 15-member eurozone, with the rate rise expected to be a one-off for now as the economy loses steam, dealers said.
The dollar's weakness against the euro "was limited by receding expectations of a series of rate hikes in Europe amid uncertainty over the economic outlook," said Yuya Koike, forex strategist at Hachijuni Bank.
The interest rate gap between the eurozone and the United States -- the Federal Reserve's key rate is at 2.0 pc -- has weighed on the dollar, which has also been weakened by lacklustre US economic growth.
Traders are waiting for the results of the Japanese central bank's key Tankan survey of business confidence due Tuesday, amid forecasts of a sharp deterioration in sentiment.
The market is also skittish ahead of Friday's monthly labour market report for June in the United States, particularly after a much bigger-than-expected jump in the unemployment rate in May to 5.5 pc.
On Tuesday the latest snapshot of the US manufacturing sector is due from the Institute for Supply Management.
"If US economic indicators turn out to be weaker than expected, the dollar may fall below 105 yen this week," said Yuji Saito, head of foreign exchange at Societe Generale in Tokyo.
Against regional Asian currencies, the dollar fell to 1.3616 Singapore dollars from 1.3646 on Friday, to 30.37 Taiwan dollars from 30.40 and to 33.53 Thai baht from 33.56.
But it rose to 1,046.05 South Korean won from 1,044.95, to 44.87 Philippine pesos from 44.76 and to 9,225.00 Indonesian rupiah from 9,217.50.