Indian rupee retreated after scaling three-week high level ended weak on Thursday as good dollar demand from state-run banks on behalf of both importers and the Reserve Bank of India (RBI) offset inflows seen with foreign banks. RBI reportedly bought dollars via state-run banks around 59.60 levels to prevent further appreciation in the pair, but the intervention was sporadic and not easily spotted. Besides, somewhat lower local equities also weighed on the sentiment. However, further slide of local currency was prevented after activity in India's services sector grew at its fastest pace in well over a year in June as new business poured in, adding to signs of a pick-up in the economy even as inflation remained high. The HSBC Services Purchasing Managers' Index, compiled by Markit, jumped to a 17-month high of 54.4 in June from 50.2 in May. On the global front, dollar held firm above a recent eight-week low on Thursday, supported by hopes for a healthy rise in nonfarm payrolls, while the Aussie fell after Australia's central bank chief warned that markets are underestimating the risk of a sharp fall in the currency.
Finally, the rupee ended at 59.74, weaker by 7 paise from its previous close of 59.67 on Wednesday. The currency touched a high and low of 59.84 and 59.52 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 59.72 and for Euro stood at 81.54 on July 03, 2014. While, the RBI’s reference rate for the Yen stood at 58.62, the reference rate for the Great Britain Pound (GBP) stood at 102.4539. The reference rates are based on 12 noon rates of a few select banks in Mumbai.
