USD rises to 13 year high against rupee

The US dollar climbed on Friday to its highest level since 2003 on continued bets on faster inflation and higher interest rates. The Indian currency fell by 31 paise to end at 68.13 against the US dollar.

 Meanwhile treasuries resumed a selloff that left benchmark yields on track to post their steepest two-week increase in 13 years. US dollar started increasing against all major counterparts after Fed Chair Janet Yellen repeated that the US interest rates could rise relatively soon due to an improving domestic labour market and stronger growth.

A growing perception that the economic policies of newly elected US President, Donald Trump will lift consumer prices, pushed the dollar higher, weighing on crude and other commodities.

The US dollar's rise against the yen raised hopes of an earnings boost to Japanese exporters, helping increasing the Nikkei average to about 10-month high.

Indian capital markets dropped to six months low after growing impact of demonetisation on the economy. BSE Sensex dropped 0.30 per cent to 26150.24; and Nifty also reduced by 0.07 per cent to 8074.1 on Friday. The foreign institutional investors had sold about Rs 9340.5 equities in Indian markets from November 10. On the contrary, domestic institutional investors bought equities of Rs 4591.79 after demonetisation was announced.