Rupee ends upbeat for second consecutive session on incremental dollar sales

Indian rupee, ended stronger for second consecutive session on Tuesday on the back of custodian and corporate dollar sales, while splendid gains of local equities, after Reserve Bank of India’s chief, Raghuram Rajan assured investors of room still being left for slashing rates in the near future if disinflation continued, also aided the sentiment. In its third bi-monthly policy review, RBI kept key policy rates unchanged, but warned about inflationary risks should a shortfall in monsoon rains spark a surge in food prices. However, further gains of local equities were capped after growth in India's services sector eased in July as new orders slowed, prompting some companies to put hiring plans on ice. The HSBC Services Purchasing Managers' Index (PMI), compiled by Markit, fell to 52.2 in July from June's 17-month high of 54.4. On the global front, euro headed back below $1.34 on Tuesday after data on Italy's service sector proved weaker than expected, while a surprise bounce for equivalent numbers in Sweden and Britain drove the crown and the pound higher

Finally the rupee ended at 60.84, stronger by 9 paise from its previous close of 60.93 on Monday. The currency touched a high and low of 60.99 and 60.69 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 60.86 and for Euro stood at 81.69 on August 05, 2014. While, the RBI’s reference rate for the Yen stood at 59.38, the reference rate for the Great Britain Pound (GBP) stood at 102.6738. The reference rates are based on 12 noon rates of a few select banks in Mumbai.