Rupee extends gains for second straight session

Extending gains for the second straight session, Indian rupee ended considerably stronger against dollar on Friday, on account of selling of American currency by banks and exporters amid softening crude oil prices. Traders took encouragement with Finance Minister Arun Jaitley’s statement that demonetisation helped in tackling black money and expanding the tax base. Demonitisation is a key step in a chain of important decisions taken by the Government to formalise the economy. Traders shrugged off Moody’s Investors Service’s report that Indian economy will expand 7.4% in 2018, but the growth will slow down to 7.3 per cent in the next year as domestic demand tapers on higher borrowing cost due to rising interest rates. On the global front, dollar gained versus the euro and sterling on Friday as the U.S. Federal Reserve kept interest rates steady but reaffirmed its monetary tightening stance, setting the stage for a rate hike in December.

Finally, the rupee ended at 72.50, 50 paise stronger from its previous close of 73.00 on Tuesday. The currency touched a high and low of 72.82 and 72.45 respectively. The reference rate for the dollar stood at 72.73 and for Euro stood at 82.51 on November 9, 2018. While the reference rate for the Yen stood at 63.84, the reference rate for the Great Britain Pound (GBP) stood at 94.87. The reference rates are based on 12 noon rates of a few select banks in Mumbai.