Indian Rupee Rise Up After Reserve Bank of India Held Rates
The Indian rupee is up on Wednesday after the Reserve Bank of India unexpectedly held rates. Also, The rupee currency is higher by 0.4% at 67.110 per dollar as of 8:24 a.m. ET. Importantly, India’s central bank held its benchmark interest rate at 6.25%, signaling the end of a loosening cycle. “The decision of the MPC is consistent with a neutral stance of monetary policy in consonance with the objective of achieving consumer price index or CPI inflation at 5 per cent by Q4 of 2016-17 and the term target of 4 per cent within a band of +/- 2%, while supporting growth,” the RBI said in its statement. Shilan Shah also said; “With inflation accelerating, we continue to think that rate hikes will come onto the agenda sooner than expected”.
Indian rupee weakened against the U.S. dollar in on Wednesday, after India’s central bank kept its interest rates unchanged again.
The Monetary Policy Committee of the Reserve Bank of India, headed by Urjit Patel, unanimously decided to hold the key repo rate at 6.25 percent and reverse repo rate at 5.75 percent. The bank was widely expected to cut its rates by 25 basis points.
Against the U.S. dollar, the rupee fell to 67.390 from an early high of 67.268.