Governor Raghuram Rajan said the central bank had tilted towards keeping rates on hold even before November consumer and wholesale price inflation data were released.
In an interview to television channel ET Now, he said when growth is weak, we have to be careful of "over-tightening".
"The governor's comments helped the rupee a bit. At least the market now thinks that the central bank will consider growth as well when framing monetary policy," said Hari Chandramgethen, head of foreign exchange trading at South Indian Bank.
"I expect some support for the dollar/rupee around 61.65 levels with the pair broadly holding in a 61.60 to 62.40 range until the year-end."
The partially convertible rupee closed at 61.9525/9625 per dollar compared with 62.04/05
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