RBI set the reference rate for USD/INR at 74.42 levels

The USDINR pair made a gap up opening at 74.54 levels and traded in the range of 74.38-74.58 with a downside bias. The pair finally closed the day at 74.40 levels. Some foreign banks were said to have sold dollars likely for inflows into Indian companies looking to raise funds through offshore investors, which supported the rupee. The rupee rose to as much as 74.38 a dollar in the spot market today. On an annualized basis, the premium on the one-year, exact-period dollar/rupee contract stood at 4.47%, against 4.50% recorded in the previous day. The new 10-year G-Sec benchmark 06.10 GS 2031 closed the day at 6.1648 levels.

The Reserve Bank of India set the reference rate for USDINR at 74.42 levels. India's FX Reserves rose to USD 612.73 billion as against USD 611.9 billion recorded in the previous print. U.K. retail sales surged unexpectedly in June as the volume of goods sold in shops and online rose to 0.5% from the month before. Britain's rapid economic bounce-back from the pandemic slowed sharply in July. The composite PMI dropped to 57.7 in July from 62.2 in June.

Eurozone business activity expanded at its fastest monthly pace in over two decades in July as Composite PMI Index climbed to 60.6 in July from 59.5, its highest reading since July 2000. Oil prices fell below $74 a barrel today but were on track to end the week largely unchanged after rebounding from a sharp drop on Monday, underpinned by expectations that supply will remain tight as demand recovers.

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