Indian rupee depreciated to its fresh 6 months low on Wednesday, reigniting the concerns about the government’s finances and the longer-term outlook for an economy that has just begun to show signs of recovery. Dollar demand from oil importers combined with slide of local equities, weighed on the sentiment of Indian currency. Further, reports suggesting to an end of Fed's bond buying programme, earlier than expected also sapped the risk appetite for emerging markets assets, including Indian currency. However, the Indian currency recovered significantly from day’s low as dollar shed some of its recent gains against a basket of major currencies on Wednesday as investors trimmed their bets on the currency before testimony of the US Federal Reserve chief.
Finally the rupee ended at 55.49, weaker by 9 paise from its previous close of 55.40 on Tuesday. The currency touched a high and low of 55.64 and 55.33 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at Rs 55.52 and for Euro it stood at Rs 71.67 on May 22, 2013. While, the RBI’s reference rate for the Yen stood at 54.07, the reference rate for the Great Britain Pound (GBP) stood at 84.0936. The reference rates are based on 12 noon rates of a few select banks in Mumbai.
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