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Rupee weakens on increased demand for American currency from importers

01 Mar 2018 Evaluate

Indian rupee weakened against the US dollar on Thursday on account of increased demand for the American currency from importers and firm foreign fund outflows. Investors overlooked report that in a significant recovery, India’s Gross Domestic Product (GDP) grew at 7.2% in the third quarter of financial year 2017-18 (October-December), up from 6.5% and 5.7% in the previous two quarters respectively. Further, strength in dollar against other currencies overseas also kept pressure on the domestic currency. On the global front, the dollar rose to five-week high, as Powell’s optimism on the US economy suggested the Fed is going to raise interest rates four times this year, one more than what markets had expected.

The partially convertible currency is currently trading at 65.21, weaker by 4 paise from its previous close of 65.17 on Wednesday. The currency touched a high and low of 65.2500 and 65.1000 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 65.10 and for Euro stood at 79.58 on February 28, 2018. While the RBI’s reference rate for the Yen stood at 60.80, the reference rate for the Great Britain Pound (GBP) stood at 90.44. The reference rates are based on 12 noon rates of a few select banks in Mumbai.

Date1US$1GBP
February 28, 201865.103190.4477
February 27, 201864.851490.5844

(RBI-Reference Rate)

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