Indian Rupee Rises Against U.S. Dollar As RBI Leaves Key Rates Unchanged

The Indian rupee advanced against the U.S. dollar in afternoon deals on Wednesday, after the Reserve Bank of India kept its key repo rate unchanged for the fourth straight meeting, while cutting the statutory liquidity ratio to grant more liquidity to banks.

At its second bi-monthly monetary policy meeting, policymakers of the Reserve Bank of India decided to maintain the repo rate at 6.25 percent and the reverse repo rate at 6.00 percent.

The central bank also reduced the SLR of all banks by 50 basis points to 20 percent from 20.50 percent of their net deposits with effect from June 24.

The decision of the MPC is consistent with a neutral stance of monetary policy in consonance with the objective of achieving the medium-term inflation target, while supporting growth, the bank said.

Indian markets rose, with the benchmark BSE Sensex rising 64.30 points or 0.21 percent to 31,255, while the broader Nifty index was up 21 points or 0.22 percent at 9,656.

The rupee rose to 64.31 against the greenback, up by 0.3 percent from a 6-day low of 64.51 set in morning deals. The next possible resistance for the rupee is seen around the 63.00 region. The pair finished Tuesday's trading at 64.40.