The rupee closed marginally lower at 52.88 against the dollar as strong demand for the US currency from oil importers reversed the local unit’s gain.
In intraday trade, the rupee touched a high of 52.65 against the dollar. On Tuesday, it had closed at 52.84 per dollar.
The Indian unit opened stronger at 52.73 as the euro hit a one-month high against the dollar and yen, as Spain managed to avert a ratings downgrade.
But the local unit remains vulnerable as the US economy shows only occasional glimmer of hope of recovery. The Euro Zone continues to be in trouble with no credible resolution in sight for the Spanish debt crisis.
On the domestic front, announcements translating into action will bolster the Indian unit further. However, the rupee will remain pressurised by the month-end demand for dollar from oil importers.
The Reserve Bank of India is likely to intervene in the exchange rate only in extreme volatile situations, Deputy Governor H.R. Khan had said yesterday at a banking summit in Mumbai.
Call Rates and G-Secs
The overnight call money rates closed slightly higher at 8.10 per cent from Tuesday’s close of 8.06 per cent.
The 10-year benchmark 8.15 per cent government bond closed flat from previous close of Rs 99.97, while its yields remained stable at 8.15 per cent from Tuesday’s close.