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Rupee ends weaker against dollar on Fed rate hike

15 Jun 2017 Evaluate

Indian rupee ended considerably weaker against the US dollar on Thursday due to fresh demand for the American currency from banks and importers. Sentiments remained dampened as the US Federal Reserve raised interest rates, citing continued US economic growth and job market strength, and announced it would begin cutting its holdings of bonds and other securities this year. Some concern also came with media reports that US President Donald Trump is being investigated by a special counsel for possible obstruction of justice. Moreover, lackluster local equities along with modest capital outflows too weighed on the currency trade. On the global front, dollar inched higher against yen on Thursday, with expectations of another Federal Reserve rate hike this year pointing the way to a trimming of the huge emergency funds pumped into the economy since 2009.

Finally, the rupee ended at 64.54, 25 paise weaker from its previous close of 64.29 on Wednesday. The currency touched a high and low of 64.54 and 64.25 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 64.28 and for Euro stood at 72.10 on June 15, 2017. While the RBI’s reference rate for the Yen stood at 58.62, the reference rate for the Great Britain Pound (GBP) stood at 81.91. The reference rates are based on 12 noon rates of a few select banks in Mumbai. 

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