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Rupee extends weakness for second straight session

17 May 2017 Evaluate

Indian rupee extended its weakness for the second straight day against dollar on Wednesday due to mild dollar demand from banks and importers. Sentiments remained dampened as the United Nations (UN) lowered India's gross domestic product (GDP) growth forecast for the financial year 2017. As per the UN World Economic Situation and Prospects as of mid- 2017 report, the Indian economy is expected to grow at 7.3 percent in 2017, a downward revision from the 7.7 percent forecast in January. However, dollar weakness against basket of major currencies overseas capped some losses of the domestic currency. On the global front, dollar dropped sharply against major currencies including the pound and the euro, after Trump reportedly asked former FBI director James Comey to drop an investigation into Michael Flynn and his connections to Russia.

Finally, the rupee ended at 64.15, 7 paise weaker from its previous close of 64.08 on Tuesday. The currency touched a high and low of 64.15 and 63.98 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 64.02 and for Euro stood at 71.15 on May 17, 2017. While the RBI’s reference rate for the Yen stood at 56.99, the reference rate for the Great Britain Pound (GBP) stood at 82.76. The reference rates are based on 12 noon rates of a few select banks in Mumbai.

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