Indian rupee ended significantly lower against dollar on Thursday, on increased demand for the greenback from importers and banks. Traders got cautious amid reports that the non-food component in the price basket will continue to keep inflation at a high level and result in a 'long pause' in interest rates. The bank report said over a six month period, food inflation is likely to ease, but non-food may be sticky on account of rigidity in domestic fuel taxation, marginal hikes in manufacturing costs after months of the shutdown, commodity price rises, telecom price adjustments and return in demand impulses in certain core categories. Traders paid no heed as World Trade Organisation (WTO) stated that India has implemented several measures to facilitate trade, such as simplification of procedures and customs clearances for imports and exports. On the global front; dollar edged higher on Thursday, hovering above its lowest levels in nearly three years on Thursday after Democrats won control of the U.S. Senate, clearing the way for possible larger fiscal stimulus under President-elect Joe Biden.
Finally, the rupee ended at 73.31, 20 paise weaker from its previous close of 73.11 on Wednesday. The currency touched a high and low of 73.31 and 73.08 respectively. The reference rate for the dollar stood at 73.13, and for Euro stood 89.99 on January 06, 2021. While the reference rate for the Yen stood at 71.19, the reference rate for the Great Britain Pound (GBP) stood at 99.65.
