Rupee ends higher as cenbank holds rates but logs fifth straight weekly fall
bank kept policy rates unchanged but cut banks' cash reserve ratio, effectively easing monetary conditions amid slowing economic growth.
The rupee closed at 84.6875 against the U.S. dollar, up from its close at 84.7325 in the previous session. The currency logged fifth consecutive weekly fall, declining 0.2%.
The Reserve Bank of India also raised the interest rate ceiling that banks can offer for foreign currency non-resident (FCNR-B) deposits to boost forex inflows at a time when the rupee has been under consistent pressure.
The rupee had declined to its all-time low of 84.7575 earlier in the week, hurt by weakness in the Chinese yuan and strong dollar bids in the non-deliverable forwards market, prompting intervention by the RBI.
«Incremental capital inflows into India from these FCNR measures may help INR at the margin temporarily, but should not be substantial enough to change the overall trajectory for USD/INR to head higher,» MUFG Bank said in a note.
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