Indian rupee settled nearly 5 paise lower against the US dollar on Tuesday as traders turned cautious ahead of two key central bank policy reviews in the United States and Japan, which are scheduled to deliver their latest monetary policy decision on Wednesday. The local currency slipped to 67.02 level on Tuesday against the previous close of 66.97 on Tuesday. Buying of American currency by banks and importers strengthened the dollar in today’s trade.
Weakness in domestic equity markets further weighed on the rupee. Benchmark BSE Sensex and NSE Nifty snapped four-day winning streak on Tuesday. The 30-share index closed 111.30 points, or 0.39 per cent, down at 28523.20, while Nifty 50 index settled 32.50 points down at 8775.90.
The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 67.02 and Euro stood at 74.88 on September 20, 2016. While the RBI’s reference rate for the Yen stood at 65.86 and the reference rate for the Great Britain Pound (GBP) stood at 87.37.
According to Dun & Bradstreet (D&B), overvaluation in rupee as indicated by the REER index will continue to put pressure on rupee going forward. D&B expects the rupee to trade in the range of around 66.80-67.00 per dollar in September 2016.