Indian rupee turned weak against the dollar on Wednesday, on sustained buying of the US currency by importers and banks. The market sentiment remained cautious ahead of RBI’s two-day policy meet outcome. The first bi-monthly monetary policy review for FY19 is to be announced by the RBI on April 5. Investors even overlooked private weather forecasting agency report that monsoon rains in India are expected to be average in 2018, raising prospects of higher farm and economic growth in the $2 trillion economy. The report added that monsoon rains are expected to be 100 percent of the long-term average. Besides, heavy selling in last hour of trade in the domestic equity markets too weighed on the rupee, but dollar’s reduced clout against other currencies overseas helped to cap the losses in rupee. On the global front, U.S. dollar pulled lower on Wednesday, after China took further trade retaliatory measures against the US today, imposing a 25% import tariff on key US products.
Finally, the rupee ended at 65.14, 12 paise weaker from its previous close of 65.02 on Tuesday. The currency touched a high and low of 65.18 and 64.90 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 65.02 and for Euro stood at 79.79 on April 04, 2018. While the RBI’s reference rate for the Yen stood at 61.00, the reference rate for the Great Britain Pound (GBP) stood at 91.49. The reference rates are based on 12 noon rates of a few select banks in Mumbai.
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