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Rupee settles lower against greenback on Monday
Jun-21-2021

Indian rupee ended significantly lower on Monday following Federal Reserve official Jim Bullard’s hawkish comments that suggested the first interest rate hike by the US central bank could come as early as the end of 2022. Sentiments were also downbeat as Care Ratings said that the credit growth for current financial year (FY22) is likely to remain in low double-digit on the back of muted economic activity. The slowdown in economy can further delay anticipated pick-up in credit growth apart from the likely impact on asset quality. Traders shrugged off UNCTAD’s World Investment Report 2021 stating that the Foreign Direct Investment (FDI) into India increased 27 percent to $64 billion in 2020 from $51 billion in 2019, pushed up by acquisitions in the information and communication technology (ICT) industry, making the country the fifth-largest FDI recipient in the world. On the global front; sterling edged higher on Monday after falling overnight to its lowest level since April as the currency remained vulnerable since the U.S. Federal Reserve surprised the market with a hawkish tone last week.

Finally, the rupee ended 74.10, weaker by 24 paise from its previous close of 73.86 on Friday. The currency touched a high and low of 74.28 and 74.08 respectively.

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