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Rupee extend gains taking cues from equity markets

26 May 2017 Evaluate

Maintaining its good form for the third day, Indian rupee ended higher against dollar on Friday due to sustained selling of the US currency by exporters and banks. Sentiments remained upbeat with private weather forecaster Skymet’s statement that the increase in pre-monsoon showers across India is hinting at the arrival of monsoon 2017, which is not very far away. The weather forecasting agency predicted that monsoon will make an onset over Kerala by May 29, with a margin of error of three days. Some support also came with a private report stating that India maintained its number one position of being world’s top most greenfield FDI investment destination for the second year in a row, attracting $62.3 billion in 2016. The rupee got additional support with increased foreign fund inflows along with higher domestic equity market, which zoomed to new highs. On the global front, British pound fell sharply against major crosses on Friday, after a poll showed a further narrowing of the Conservative Party’s lead before the U.K.’s general election.

Finally, the rupee ended at 64.44, 17 paise stronger from its previous close of 64.61 on Thursday. The currency touched a high and low of 64.64 and 64.42 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 64.59 and for Euro stood at 72.33 on May 26, 2017. While the RBI’s reference rate for the Yen stood at 57.95, the reference rate for the Great Britain Pound (GBP) stood at 83.18. The reference rates are based on 12 noon rates of a few select banks in Mumbai.

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