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Rupee snaps two sessions’ appreciating string on Tuesday

10 Jul 2018 Evaluate

Snapping its two-day appreciating string, Indian rupee ended weaker against dollar on Tuesday, due to demand for greenback by banks and importers. Sentiments turned pessimistic with report that the US-China trade war will impact foreign investment into the country, and the Reserve Bank of India (RBI) will have to sell foreign currencies to defend the rupee at the 69 level to a dollar. Some concern also came with a private report stating that Indian inflation likely rose to a near two-year high in June, driven by surging oil and food prices a development that would strengthen calls for more monetary policy tightening by the Reserve Bank of India. Moreover, dollar’s strength against a basket of some currencies overseas too weighed on the rupee, though, rally in domestic equities limited further depreciation of Indian currency. On the global front, pound tumbled amid political jitters as the resignations of Foreign Secretary Boris Johnson and Brexit Secretary David Davis raised questions over Theresa May’s future as Prime Minister.

Finally, the rupee ended at 68.82, 10 paise weaker from its previous close of 68.72 on Monday. The currency touched a high and low of 68.86 and 68.75 respectively.

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