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Rupee ends weaker despite gains in equity

01 Mar 2017 Evaluate

Indian rupee ended weaker against dollar on Wednesday on account of sustained demand for dollar from banks and importers. Sentiments remained dampened with a report that India's fiscal deficit touched Rs 5.64 lakh crore at the end of January, 105.7 percent of the full-year target, mainly due to lower realisation of non-tax revenue. In the Budget presented on February 1, the government had retained the fiscal deficit target at 3.5 per cent of GDP. The rupee sentiments were also hit as the growth of eight core sectors decelerated to 3.4% in January compared to 5.7% in the same month last year, thanks to plummeting output in three key segments - cement, fertilisers and refinery products. On the global front, dollar ticked up on Wednesday as Federal Reserve policy-setters fanned expectations of a rate hike this month, while US President Donald Trump offered Congress little details on his stimulus as some investors had expected.

Finally, the rupee ended at 66.82, 13 paise weaker from its previous close of 66.69 on Tuesday. The currency touched a high and low of 66.90 and 66.76 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 66.84 and for Euro stood at 70.57 on March 1, 2017. While the RBI’s reference rate for the Yen stood at 58.91, the reference rate for the Great Britain Pound (GBP) stood at 82.71.The reference rates are based on 12 noon rates of a few select banks in Mumbai.

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