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Rupee appreciates for second consecutive session against dollar

15 Feb 2016 Evaluate

Indian rupee appreciated for the second consecutive session against dollar on increased selling of dollar by banks and exporters amid gains in Asian currencies. Besides weakness in the dollar against some currencies overseas and surge in local equity market also added to the positive milieu of Indian currency. Sentiments got a boost with Prime Minister Narendra Modi’s statement that India is the fastest developing country among the “larger economies of the world”. Besides, slip in the wholesale price index (WPI)-based inflation for the fifteenth straight month further lifted the mood of the investors. Reversing four months of rising trend, WPI inflation fell to (-) 0.9 per cent in January as food articles, mainly vegetables and pulses, turned cheaper. This was further contraction to the WPI inflation reading of (-) 0.73 per cent in December 2015. On the global front, yen's advance halted as Japan's leader criticized extremely volatile currency markets and as gains for China's yuan on its first full day's trade in a week helped settle global financial nerves.

Finally, the rupee ended at 68.06, 18 paise stronger from its previous close of 68.24 on Friday. The currency touched a high and low of 68.16 and 67.99 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 68.13 and for Euro stood at 76.50 on February 15, 2016. While the RBI’s reference rate for the Yen stood at 59.84, the reference rate for the Great Britain Pound (GBP) stood at 99.0067. The reference rates are based on 12 noon rates of a few select banks in Mumbai.      

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