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Rupee snaps 3-day gaining streak

04 Jun 2018 Evaluate

Snapping its three-day winning streak, Indian rupee ended marginally weaker against dollar on Monday, due to demand for greenback by banks and importers. Traders remained on sidelines ahead of services sector data for May slated to be released on June 5, while the Reserve Bank’s rate decision will be announced on June 6. The RBI is expected to take a wait-and-watch approach despite the higher GDP growth figures released last week. 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. Traders also found some support with Prime Minister Narendra Modi’s statement that India’s economy will sustain a growth of 7.5% to 8% per year. Further, he said the Indian government has kept its economic growth forecast for the current fiscal unchanged at 7.5%, buoyed by turnaround in manufacturing and pick up in investment. On the global front, dollar moved sharply lower against other major currencies on Monday, as investors digested the latest developments in U.S. trade talks that indicated escalated trade tensions could be on the way.

Finally, the rupee ended at 67.12, 6 paise weaker from its previous close of 67.06 on Friday. The currency touched a high and low of 67.16 and 67.85 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 67.05 and for Euro stood at 78.35 on June 04, 2018. While, the RBI’s reference rate for the Yen stood at 61.14, the reference rate for the Great Britain Pound (GBP) stood at 89.61. The reference rates are based on 12 noon rates of a few select banks in Mumbai.

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