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Rupee appreciates against dollar amid persistent foreign capital inflows

09 Jan 2013 Evaluate

Following positive local equity markets, Indian rupee appreciated against dollar on Wednesday, amid continued foreign capital inflows. Increasing dollar selling by banks and exporters also supported the local unit. However, investors were worried about country’s macroeconomic situation after rating agency - Fitch renewed ratings downgrade warning on Tuesday, which capped some of the rupee’s gains. Meanwhile, expectations of key interest rates cut by the Reserve Bank of India in its third quarter monetary policy review is also supporting the Indian currency.

The partially convertible currency is currently trading at 54.95, stronger by 5 paise from its previous close of 55.00 on Tuesday. The currency touched a high and low of 55.08 and 54.85 respectively. The Reserve Bank of India's (RBI) reference rate for the dollar stood at Rs 55.32 and for Euro it stood at Rs 72.56 on January 8, 2013. While, the RBI’s reference rate for the Yen stood at 63.33, the reference rate for the Great Britain Pound (GBP) stood at 89.0501. The reference rates are based on 12 noon rates of a few select banks in Mumbai.

Date

1US$

1GBP

January 8, 2013

55.3289.0501

January 7, 2012

54.97

88.1077

(RBI-reference rate)

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