Indian rupee ended substantially weaker against dollar on Tuesday, on increased month-end demand for the American currency from importers and banks. Sentiments remained down-beat with private report indicating that demonetisation effect is expected to slow down India’s GDP growth to 7.2% in January-March quarter from 7.6% in the preceding quarter. Though, it expects a recovery thereafter to an average of 7.5% in the second half of 2017 and 7.7% in 2018, supported by a release of pent-up consumption demand with remonetisation, easier financial conditions, pay hikes for government employees and modest external demand. Traders also remained cautious ahead of the release of the gross domestic product (GDP) data on May 31. Besides, US dollar’s gain against other currencies overseas too dragged the rupee down. On the global front, yen strengthened against major counterparts on Tuesday, as investors fret about a Greek bailout and the possibility of an early election in Italy.
Finally, the rupee ended at 64.66, 17 paise weaker from its previous close of 64.49 on Monday. The currency touched a high and low of 64.69 and 64.59 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 64.63 and for Euro stood at 71.83 on May 30, 2017. While the RBI’s reference rate for the Yen stood at 58.24, the reference rate for the Great Britain Pound (GBP) stood at 82.78. The reference rates are based on 12 noon rates of a few select banks in Mumbai.
