Rising for the second consecutive day, Indian rupee ended higher against dollar on Tuesday amid weak dollar in overseas markets. Traders were getting comfort with report of UN stating that the India's economy could prove to be the ‘most resilient’ in the subregion of South and South-West Asia over the long term, the positive but lower economic growth post COVID-19 pandemic and the country's large market will continue to attract investments. The growth, however, was mainly driven by India, which accounted for 77 percent of the total inflows and received $51 billion in 2019, up 20 percent from the previous year. Market participants also took a note of Reserve Bank of India (RBI) paper stating that maintaining the inflation target at 4 percent is appropriate for India as targeting a lower rate could impart deflationary bias to the monetary policy. On the global front, dollar languished near a 2-1/2-year low on Tuesday as investors were encouraged to take on more risk as U.S. lawmakers pushed forward with an enhanced COVID-19 relief package.
Finally, the rupee ended at 73.42, 7 paise stronger from its previous close of 73.49 on Monday. The currency touched a high and low of 73.44 and 73.34 respectively. The reference rate for the dollar stood at 73.58, and for Euro stood 89.94 on December 28, 2020. While the reference rate for the Yen stood at 71.12, the reference rate for the Great Britain Pound (GBP) stood at 99.84.
