The Indian rupee traded higher against the U.S. dollar in evening deals on Friday as a report showed that country's wholesale price-based inflation eased further in May, giving room for the Reserve Bank of India to ease its monetary policy.
Data published by the Ministry of Commerce and Industry showed that the nation's headline inflation rate slowed to a 43-month low of 4.7 percent in May from 4.89 percent in the previous month, driven by declining prices of fuel and manufactured products. This is the second month in a row that inflation has fallen below RBI's comfort level of 5 percent.
The ministry revised March WPI inflation downwards to 5.65 percent from 5.96 percent.
The RBI will announce review of monetary policy on June 17. The central bank has reduced its key rates thrice this year to revive the flagging economic growth.
The rupee appreciated to 4-day high of 57.4555 to the dollar from yesterday's closing quote of 58.0055. The rupee may face resistance surrounding 56.5 area.
For comments and feedback: editorial@rttnews.com