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Rupee declines against dollar on Wednesday
Oct-28-2020

Snapping previous day’s gaining streak, Indian rupee ended weaker against dollar on Wednesday with fresh dollar demand by banks and importers. Besides, dollar gains against other currencies overseas too hit the rupee sentiment. Investors were worried with Finance Minister Nirmala Sitharaman’s statement that there were visible signs of revival in the economy but the GDP growth may be in the negative zone or near zero in the current fiscal (FY21). She also said the economy saw a contraction in the April-June quarter, but demand has picked up in the festival season. Meanwhile, UNCTAD's latest Global Investment Trends Monitor states that in the wake of the pandemic, lockdowns around the world slowed existing investment projects and the prospects of a deep recession led multinational enterprises to reassess new projects. Also, global foreign direct investment (FDI) flows fell 49% in the first half of 2020 compared to 2019 due to the economic fallout from COVID-19. On the global front, euro fell against the dollar on Wednesday following a media report that France’s government was leaning toward reinstating a national lockdown to curb a resurgence in coronavirus cases.

Finally, the rupee ended at 73.87, 16 paise weaker from its previous close of 73.71 on Tuesday. The currency touched a high and low of 73.93 and 73.64 respectively. The reference rate for the dollar stood at 73.74 and for Euro stood 87.26 on October 27, 2020. While the reference rate for the Yen stood at 70.44, the reference rate for the Great Britain Pound (GBP) stood at 96.16.

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