INR edges up against US dollar, RBI cuts rates for first time in five years

The Indian rupee edged up a bit today after its recent tumble. INR had fallen to an all-time low against the US dollar this week, as global trade war concerns fuelled risk aversion among investors. Meanwhile, Reserve Bank of India cut the repo rate the rate at which the RBI lends to other banks by 25 basis points to 6.25 per cent, after keeping it unchanged for two years. This is the first rate cut initiated by the RBI in five years, the last one being in May 2020. RBI however continues with the neutral monetary policy stance and remain unambiguously focussed on a durable alignment of inflation with the target, while supporting growth. RBI also noted today that its forex policy has remained consistent, in favour of orderly and stable market operation, does not target any exchange rate. Rupee currently quotes at 87.42 per US dollar, up 16 paise on the day. The US dollar index is holding around 107.50, down marginally on the day.

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