Dollar closed at 64.3700 against its opening of 64.5500. Dollar traded down during European trades Monday tracking the drop in the spot pair on selling by foreign banks amid bunched up dollar inflows after extended weekend and also Power Finance Corporation (PFC) dollar bond related inflows. However, sharp upside was limited as most investors awaited the release of Reserve Bank of India-led Monetary Policy Committee (MPC) two-day monetary policy meeting outcome on Wednesday. But the pair had fallen momentarily after opening on selling by foreign banks amid overseas funds inflows into local stocks. Local stocks opened higher after US senate approved tax reform bill amid overseas investors buying local stocks worth Rs 197 billion in November, the highest since March. Meanwhile, investors await for the RBI policy meet Wednesday and the Gujarat poll outcome later on December 18. Reserve Bank of India led Monetary Policy Committee (MPC) will commence its two-day meeting tomorrow. Market Participants expect MPC to maintain a status-quo, keeping the central bank's key lending rate or repo rate at 6% in the fifth bi-monthly monetary policy.
The greenback remained subdued on uncertainty after former National Security Adviser Michael Flynn pleaded guilty Friday to lying to the FBI.
BSE Sensex closed higher by 36.78 points to 32,869.72, while the Nifty 50 rose 5.95 points.
INTERNATIONAL
Asian shares mostly gained with Tokyo down slightly as progress on passing tax cuts in the US lifted sentiment.
Bank of Japan Governor Haruhiko Kuroda on Monday urged financial institutions to reform their business structures to make effective use of financial technology, which is triggering big changes to global financial markets.
Oil fell after U.S. shale drillers added more rigs last week, but prices still held close to their highest since mid-2015, supported by an extension of output cuts agreed last week by OPEC and other producers.
Gold prices dipped in Asia as expectations that US tax cuts are closer to passage and as news on the politics surrounding the investigation of Russian meddling in the 2016 election was mulled.