Rupee ends stronger at 59.18

Our Bureau Updated - June 06, 2014 at 06:43 PM.

rupee

The Indian rupee ended 16 paise stronger at 59.18 against the dollar driven by robust capital inflows into the domestic equity market even as banks bought dollars on behalf of RBI.

The rupee had closed flat at 59.34 on Thursday.

The domestic currency opened 14 paise higher at 59.20 per dollar and touched a high of 59.08 at the Interbank Foreign Exchange market.

However, dealers said RBI was likely to have intervened and bought dollars reserves that limited the gains and led the rupee decline to 59.22 in the afternoon trading session.

The BSE benchmark Sensex jumped to record high closing of 25,396, with 377 points (1.51 per cent) higher over its previous close. NSE’s Nifty also soared by 109 points (1.46 per cent) to end at 7,583 points at day’s close.

According to an HSBC survey, business activity in emerging markets expanded at the fastest rate in three months in May. Also, the US unemployment rate remaining flat showing positive trends in hiring, which can boost the global economic outlook and also strengthen the American dollar.

Call rates rise, bond yields drop

Amid high liquidity, the overnight call money rate (the rate at which banks borrow money from each other to overcome short-term liquidity mismatches) ended sharply higher at 8.45 per cent from its previous close of 7.60 per cent on Thursday.

Yield on the benchmark 8.33 per cent government security, maturing in November 2023, softened further to 8.51 per cent from its previous four-month low of 8.53 per cent on Thursday. Prices of the security rose to Rs 102.02 from Rs 101.94.

The bond yields are likely to drop lower to 8 per cent levels by November, a public sector dealer had said on Thursday.

Published on June 6, 2014 10:24