Extending losses for the fourth straight session, Indian rupee ended marginally lower against dollar on Monday due to dollar demand from banks and importers. Rupee was strong in the early deals but lost its momentum in the end. Sentiments remained dampened with the report that foreign investors have pulled out over Rs 5,100 crore from the Indian capital market so far this month over concerns regarding 'lower prospects' of economic growth as compared to other emerging markets. The latest FPI outflow followed withdrawal of close to Rs 77,000 crore on net basis from equity and debts together in last three months (October-December). Meanwhile, describing the official data on the index of industrial production (IIP) for November 2016, during which demonetisation was announced, as a ‘false positive’, Crisil Research has said that the latest IIP figures do not reflect the true condition of the Indian manufacturing sector. Belying popular expectations, India's factory output, as measured by the IIP released earlier this month, has rose 5.7% in November, the first month of the government's demonetisation drive. On the global front, dollar weakened against a wide range of currencies on Monday amid disappointment that U.S. President Donald Trump’s inauguration speech proved light on detail over his plans for economic stimulus.
Finally, the rupee ended at 68.21, 3 paise weaker from its previous close of 68.18 on Friday. The currency touched a high and low of 68.22 and 68.01 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 68.08 and for Euro stood at 73.14 on January 23, 2017. While the RBI’s reference rate for the Yen stood at 60.10, the reference rate for the Great Britain Pound (GBP) stood at 84.64.The reference rates are based on 12 noon rates of a few select banks in Mumbai.
