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Rupee strengthens on tuesday on unexpected CRR cut

24 Jan 2012 Evaluate

Indian rupee led gains in Asian currencies as the Reserve Bank of India unexpectedly lowered the cash- reserve requirement for lenders for the first time since 2009 and signaled future interest-rate cuts to support growth. The rupee advanced as much as 0.3% to 49.9250 per dollar in its intraday trade, the strongest level since November. Local currency increased against the US dollar on the back of sustained capital inflows and weakness in the American currency overseas. Surge in local equity markets also supported the local currency.

Finally the rupee ended at 50.0450, stronger by 5 paise from its previous close of 50.10 on Monday. It has touched a high and a low of 50.1250 and 49.9275 respectively. The Reserve Bank of India's reference rate for the dollar stood at Rs 49.9673 and for Euro it stood at 65.0887 on January 24, 2012. While, the RBI's reference rate for the Yen stood at 64.90 the reference rate for the Great Britain Pound (GBP) stood at 77.7441. The reference rates are based on 12 noon rates of a few select banks in Mumbai.

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