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Rupee ends lower for third straight session

02 Jun 2021 Evaluate

Indian rupee ended considerably weaker against the US dollar on Wednesday on increased demand for the greenback from importers and banks. This was the third consecutive session when the rupee was traded lower against dollar. Sentiments were fragile with reports that even though the cost of funds for the Centre has been trending down following the deft yield management by the Reserve Bank, for the hapless states, whose finances are crippled by the continuing lockdowns, it has been heading north and so far this fiscal as the average interest rate on their market borrowings has jumped 30 bps to 6.86 per cent. Traders also remained on sideline despite report that India’s exports grew by 67.39 per cent to $32.21 billion in May driven by healthy growth in sectors such as engineering, pharmaceuticals, petroleum products and chemicals. Exports in May last year stood at $19.24 billion and in May 2019 it was at $29.85 billion. On the global front; pound was little changed on Wednesday as investors weighed the possibility that a COVID variant, first found in India, could delay the final phase of reopening in Britain on June 21.

Finally, the rupee ended 73.09, weaker by 19 paise from its previous close of 72.90 on Tuesday. The currency touched a high and low of 73.30 and 73.04 respectively.

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