FX.co ★ Indian Rupee Rises To Near 2-week High Versus U.S. Dollar After RBI Rate Hike

The Indian rupee climbed against the U.S. dollar in evening deals on Wednesday, after the Reserve Bank of India raised the benchmark lending rate unexpectedly and said that it would maintain an accommodative stance while focusing on withdrawal of accommodation to support growth.

In an unscheduled meeting, the Monetary Policy Committee of the RBI unanimously voted to increase the repo rate by 40 basis points to 4.4 percent.

The cash reserve ratio was raised by 50 basis points to 4.5 percent.

The MPC noted that it would remain accommodative while focusing on withdrawal of accommodation to ensure that inflation remains within the target going forward, while supporting growth.

The Indian rupee spiked up to near a 2-week high of 76.18 against the greenback from yesterday's close of 76.46. The rupee is likely to face resistance around the 74.00 region, if it gains again.