USD/INR Closed at 68.70 against its open at 68.43. The pair recovered intra day on buying by foreign banks and after oil importers. Interest rate hike by the Reserve Bank of India amid no rate action by the Federal Reserve.The Reserve Bank of India's Monetary Policy Committee on Wednesday hiked its main lending rate -- the repo -- by 25 basis points to 6.50% with immediate effect, but retained a neutral policy stance as policymakers try to strike a balance between rising inflationary pressures and still recovering growth.
This is the first time since October 2013 that the Central Bank has hiked borrowing costs at two consecutive policy meetings.
In June policy, MPC had hikes repo rate for the first time in over four years, by 25 basis points to 6.25%.
Meanwhile, the greenback turned mixed against its major peers following a two-day meeting of the Federal Open Market Committee.
The Federal Reserve on Wednesday announced its widely expected decision to leave interest rates unchanged and maintained the target range for the federal funds rate at 1.75 to 2%.
Asian stocks dropped as the latest escalation in the Sino-U.S. trade war hit Chinese shares.Global demand for gold fell 6 percent in the first half of this year due mainly to a sharp decline in purchases.Oil prices rose steadying after losses over the past two days from a surprise increase in U.S. crude inventories.
Sensex provisionally ends 377 points lower with 23 components in the red.