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Rupee posts biggest single day fall in over month and a half on Monday

15 Sep 2014 Evaluate

Indian rupee, posted its worst single-day decline in nearly one-and-a-half month on Monday, tailing negative local equities and on account of weakness in other Asian currencies against the dollar. Besides, dollar demand from custodian banks also weighed on the sentiments. The currency failed to draw any solace from five year low August WPI data after reports suggested of central bank likely to keep interest rates on hold later this month to prevent a revival in price pressures once the economy gains momentum. On the macro-front, India's main inflation gauge, based on monthly WPI, stood at 3.74% for the month of August as compared to 5.19% in the previous month and 6.99% during the corresponding month of the previous year. On the global front, dollar further strengthened after data out on Saturday showed China's factory output grew at the weakest pace in nearly six years in August, and growth in other key sectors also cooled.

Finally the rupee ended at 61.14, weaker by 48 paise from its previous close of 60.66 on Friday. The currency touched a high and low of 61.17 and 60.92 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 60.99 and for Euro stood at 79.03 on September 15, 2014. While, the RBI’s reference rate for the Yen stood at 56.85, the reference rate for the Great Britain Pound (GBP) stood at 99.0978. The reference rates are based on 12 noon rates of a few select banks in Mumbai.

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