Evening Report-Aug 20.

Indian rupee closed at 43.71 facing increased downward pressure with the government’s trade deficit rising on account of high crude oil price, which has also led to double digit inflation. FII outflows from the stock market due to a weak economic outlook have also put pressure on the currency. U.S.dollar held near a 2008 high against a basket of major currencies as investor bearishness on the global economic outlook prompted a view that rates outside the U.S. EURUSD started trading lower after running into resistance at the 1.4800 price level on renewed concern that economic growth in the region is weakening. Euro-Zone June construction report showed a contraction in the sector of 0.6%, which reduced over 75 points. The boost the market received from mild weather in the first quarter has dissipated and the slowing growth in the region has begun to take its toll.Bank of England policy makers split three ways in August, with one arguing for higher rates to tame inflation and another voting for a cut to stave off a recession. U.K. pound traded near a two-year low versus the dollar after minutes of the Bank of England's August meeting showed inflation risks may have ``eased a little'' while the economic-growth outlook worsened. Pound fell over 50 bps after the release of the BoE minutes as traders anticipated a dovish statement. The central bank voted to leave their benchmark rate unchanged at 5.00%. It was the second consecutive month that the tally fell that way as Tim Besley pushed for a rate hike and David Blanchflower voted again for easing.Yen gained and was seen trading near 110.20Japan’s All Industry Activity Index printed in line with expectations at -0.9% in June,the release reinforced the negative tone of recent Japanese economic data further supporting the likelihood of a looming recession for the world’s second-largest economy