Indian rupee gave up most of its initial gains but managed to end marginally higher against dollar on Wednesday on the back of mild sale of dollars by banks and exporters. Traders took some support as Prime Minister Narendra Modi announced a stimulus package totalling Rs 20 lakh crore to rescue the economy reeling under the impact of coronavirus. This amounts to nearly 10% of India's GDP. This economic package will focus on areas like land, labour, liquidity and law. However, gains remain capped as India's industrial output, measured in Index of Industrial Production (IIP), contracted by 16.7% in March 2020 mainly on account of poor show by mining, manufacturing and electricity sector due to the nationwide lockdown. On the global front, dollar held below a three-week high on Wednesday ahead of a speech by Federal Reserve Chairman Jerome Powell on growing speculation that the United States could introduce negative interest rates.
Finally, the rupee ended at 75.46, 5 paise stronger from its previous close of 75.51 on Tuesday. The currency touched a high and low of 75.50 and 75.30 respectively. The reference rate for the dollar stood at 75.79 and for Euro stood at 81.95 on May 12, 2020. While the reference rate for the Yen stood at 70.52, the reference rate for the Great Britain Pound (GBP) stood at 93.40.
