Indian Rupee Off 5-day High Vs U.S. Dollar After RBI Rate Cut
March 04 2015 - 1:13AM
RTTF2
The Indian rupee retreated from its early high against the U.S.
dollar in late morning deals on Thursday, after the Reserve Bank of
India slashed rates unexpectedly on the back of soft inflation.
The central bank cut its repo rate by 25 basis points to 7.50
percent with immediate effect. Consequently, the reverse repo rate
was adjusted to 6.50 percent. The bank last reduced its key rates
by 25 basis points in January.
The cash reserve ratio was kept unchanged at 4.00 percent.
Given low capacity utilisation and still-weak indicators of
production and credit off-take, it is appropriate for the Reserve
Bank to be pre-emptive in its policy action to utilize available
space for monetary accommodation, the bank said.
The rupee reversed from an early 5-day high of 61.56 against the
greenback and edged down to 61.92. The rupee may possibly find
support around the 62.5 zone.
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