Indian rupee depreciated against US dollar on Tuesday as investors turned cautious ahead of the two-day rate-setting meeting of the Federal Open Market Committee that begins later on day. The Fed is widely expected to raise interest rates by a quarter percentage point. Meanwhile, traders also remained cautious ahead of the Consumer Price Index (CPI) data which is expected to cool down for the month of November, as the data accommodates the impact of the government’s decision to demonetize high value currency notes that month. The all-India general CPI inflation had dropped to 4.2% in October from 4.39% in the previous month. Besides, dollar strengthened against other currencies overseas, weighing down the rupee but positive gains in the domestic equity market capped the fall. On the global front, pound spiked up against its major counterparts after data showed that U.K. inflation accelerated more than expected in November to the highest rate since October 2014.
Finally, the rupee ended at 67.54, 13 paise weaker from its previous close of 67.41 on Friday. The currency touched a high and low of 67.54 and 67.42 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 67.48 and for Euro stood at 71.76 on December 13, 2016. While the RBI’s reference rate for the Yen stood at 58.54, the reference rate for the Great Britain Pound (GBP) stood at 85.54.The reference rates are based on 12 noon rates of a few select banks in Mumbai.
