After moving about 24 paise during the day, the rupee ended flat at 54.78 against the dollar on Thursday due to a choppy domestic equity market and volatile capital flows.
The Indian unit opened marginally higher at 54.76 from Wednesday’s close of 54.78 on positive domestic and Asian equity markets.
Later, it declined to 54.89 against the dollar in the afternoon trades on mild capital outflows and a weaker euro. The euro weakened due to lower output data.
However, the rupee recovered to 54.65 in the afternoon session of trading on capital inflows and weakening of the dollar from a fresh 4-1/2 year high against the Japanese yen due to disappointing US industrial data.
The rupee is likely to trade positive on hopes of rate cut by the Reserve Bank of India in its monetary policy review next month.
The rate cut is expected on the basis of April inflation at 4.89 per cent recorded below RBI's comfort level (5 per cent).
Call rates, G-Secs
The interbank call money rates ended flat from the previous close of 7.30 per cent. the call money market has remained almost flat since the beginning of this week.
The 8.15 per cent government security, which matures in 2022, gained for the fourth consecutive day to close at Rs 104.94 from Wednesday’s close of Rs 104.50. Yields softened even further to 7.39 per cent from 7.45 per cent.