After hitting 20-month high, Indian rupee weakened against dollar on Monday, due to growing safe haven appeal for the American currency on increased geo-political risks and higher chances of a tighter US monetary policy. Besides, investors remained cautious with Fitch ratings’ report that the government’s excessive backing to banks in order to deal with stressed assets and loose macro-economic policy that could stoke inflation, would prove ‘negative’ for Indian economy. Moreover, losses in the domestic equity markets also weighed on the rupee sentiments. On the global front, Britain's sterling rose against dollar on Monday, clawing up from a three-week low ahead of a packed week of data expected to show a tightening squeeze on the country's consumers.New York Fed President William Dudley said the Fed might avoid raising interest rates at the same time that it begins shrinking its $4.5 trillion bond portfolio, prompting only a ‘little pause’ in the central bank’s rate hike plans. His comments bolstered US Treasury yields and burnished the dollar's yield allure.
Finally, the rupee ended at 64.56, 30 paise weaker from its previous close of 64.26 on Friday. The currency touched a high and low of 64.60 and 64.31 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 64.44 and for Euro stood at 68.25 on April 10, 2017. While the RBI’s reference rate for the Yen stood at 57.87, the reference rate for the Great Britain Pound (GBP) stood at 79.85. The reference rates are based on 12 noon rates of a few select banks in Mumbai.
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