Snapping two-day losing streak, Indian rupee recovered against the American currency on Tuesday on the back of dollar sales by exporters and bank. Traders took some support with Moody's report that the Indian economy will likely grow in the range of 6.5-7.5% over the next 12-18 months and the growth momentum will get support from the goods and services tax (GST) regime. Investors remained optimistic ahead of outcome interest rate decision from two-day Monetary Policy Committee meeting that started today. The street is expecting a rate cut of at least 25 basis points by RBI tomorrow. Moreover, gains in the domestic equities and continuous foreign capital inflows too supported the domestic unit. On the global front, dollar edged up against a trade-weighted currency basket on Tuesday, but held close to a 14-month low as investors added to bets that political turmoil in Washington will hit prospects of another Federal Reserve rate hike in coming months.
Finally, the rupee ended at 64.08, 11 paise stronger from its previous close of 64.19 on Monday. The currency touched a high and low of 64.14 and 64.05 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 64.06 and for Euro stood at 75.74 on August 01, 2017. While the RBI’s reference rate for the Yen stood at 58.12, the reference rate for the Great Britain Pound (GBP) stood at 84.62. The reference rates are based on 12 noon rates of a few select banks in Mumbai.
