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Rupee ends at 2-week low against dollar

09 Feb 2018 Evaluate

Indian rupee ended at a 2-week low against US dollar on Friday, following steady uptick in dollar demand from importers and banks. Cautiousness remained in the market with the report that foreign portfolio investors have turned wary on Indian shares again owing to the recent global market sell-off triggered by rising bond yields in developed markets including in the US and the euro zone. FPIs have sold shares worth Rs 3,665.6 crore in the domestic stock market (including provisional data of Wednesday and Thursday) in February after pumping close to Rs 13,000 crore into Indian equities in January. Investors failed to draw any sense of relief with private report highlighting that fears of the Reserve Bank of India going for a rate hike are overdone and there is still room for a 25 bps rate cut in the August monetary policy review, provided rains are normal. Moreover, sharp fall in equities too affected the rupee. On the global front, the dollar climbed as the US government reopened following a five-hour shutdown after the House of Representatives approved a budget which will keep it running until the end of next month.

Finally, the rupee ended at 64.39, 14 paise lower from its previous close of 64.25 on Thursday. The currency touched a high and low of 64.44 and 64.29 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 64.36 and for Euro stood at 78.89 on February 09, 2018. While the RBI’s reference rate for the Yen stood at 59.06, the reference rate for the Great Britain Pound (GBP) stood at 89.71. The reference rates are based on 12 noon rates of a few select banks in Mumbai.

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