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Rupee finishes around its previous level; dollar demand weighs

10 Aug 2011 Evaluate

Indian rupee prolonging its lull for yet another session ended weak on Wednesday as the onshore forward premiums crashed on fears of dollar shortage amidst strength of the dollar overseas. Although the Indian currency appreciated almost 1 percent in the morning trading, but it soon retreated and steadied around its previous levels amid increasing dollar demands from oil importers. Early in the morning, the rupee had staged a reversal of its 5-day losing streak as the Indian market saw a spectacular comeback, boosted by offshore gains after the Federal Reserve pledged to keep interest rates on hold for at least two years and left open the possibility of a third round of bond purchases to bolster the world's largest economy.

Finally the rupee ended at 45.24, weaker by 3 paise from its previous close of 45.21 on Tuesday. It touched a high and low of 45.28 and 44.95 respectively. The Reserve Bank of India's reference rate for the dollar stood at 45.21 and for Euro it stood at 64.76 on August 10, 2011. While, the RBI's reference rate for the Yen stood at 58.85 and the reference rate for the Great Britain Pound (GBP) stood at 73.5092. The reference rates are based on 12 noon rates of a few select banks in Mumbai.

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