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Rupee strengthens on increased selling of American currency by exporters and banks

01 Dec 2015 Evaluate

Indian rupee strengthened against dollar in early deals on Tuesday on increased selling of the American currency by exporters and banks and as the government data showed stronger-than-estimated gross domestic product (GDP) and improvement in fiscal deficit data for the September quarter. Reports showed India’s GDP growth was at 7.4% in the September quarter compared with 7% in the June quarter as measured at market prices. Gross Value Added (GVA), a new concept introduced by CSO to measure the economic activity, also accelerated during the second quarter to 7.4%, from 7.1% in the April-June period. Another report showed that India's fiscal deficit reached 74% of the full-year target during April-October versus 89.6% of the full-year target during the same period a year ago. Besides, weakness in the dollar against other currencies and a higher opening in the domestic equity market also influenced uptrend in the rupee. The sentiment improved further as RBI kept its key repo lending rate unchanged at 6.75 percent. On the global front, the dollar stepped back on Tuesday after nearing a 13-year high against a basket of currencies as traders bought back the euro, long depressed by expectations of aggressive policy easing from the European Central Bank.

The partially convertible currency is currently trading at 66.49, stronger by 17 paise from its previous close of 66.66 on Monday. The currency touched a high and low of 66.54 and 66.4350 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 66.81 and for Euro stood at 70.68 on November 30, 2015. While, the RBI’s reference rate for the Yen stood at 54.41 the reference rate for the Great Britain Pound (GBP) stood at 100.3692. The reference rates are based on 12 noon rates of a few select banks in Mumbai.

Date1US$1GBP
November 30, 201566.8148100.3692
November 27, 201566.7503100.6795

(RBI-Reference Rate)

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