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Rupee erases early losses; ends tad strong on dollar sales by exporters

04 Jun 2014 Evaluate

Indian rupee, erasing losses after hitting three-week low level in previous session of trade, strengthened on Wednesday despite losses of local equities on some dollar selling pressure by exporters. Some sense of relief was drawn out from good macro-economic report, which suggested that activity in Indian services sector, representing around 60% of Indian GDP, increased in the month of May on the back of rising new orders. The HSBC services Purchasing Managers’ Index (PMI), based on the survey of around 350 private service sector companies rose to 50.2 in May from 48.5 in the previous month, above 50 mark that separates growth from contraction. On the global front, dollar hit its highest level in a month against the yen on Wednesday, reflecting a jump in Treasury yields this week that has helped prod the U.S. currency to three-month highs in trade-weighted terms.

Finally, the rupee ended at 59.34, stronger by 6 paise from its previous close of 59.40 on Tuesday. The currency touched a high and low of 59.48 and 59.20 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 59.33 and for Euro stood at 80.76 on June 4, 2014. While, the RBI’s reference rate for the Yen stood at 57.76, the reference rate for the Great Britain Pound (GBP) stood at 99.1801. The reference rates are based on 12 noon rates of a few select banks in Mumbai.

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