Rupee hits 1-year high 0f 58.98; recovers to end flat

Our Bureau Updated - March 12, 2018 at 05:04 PM.

rupee

Retreating from over a one-year high of 58.98, the rupee ended flat at 59.19 against the American dollar amid bouts of heavy selling by foreign banks and RBI intervention to buy dollars.

The domestic unit had ended 16 paise stronger at 59.18 on Friday.

"Foreign banks sold dollars on behalf of exporters aiding gains in the rupee. Capital flows into the equity markets further boost the sentiments," said a dealer with a public sector bank.

The rupee opened stronger by 10 paise at 59.09 per dollar the Interbank Foreign Exchange market on robust domestic equity market.

Sensex, BSE-benchmark index, closed at its lifetime high of 25,580 points, soared by 184 points (0.72 per cent) over its previous close.

With such sustained capital inflows, the rupee touched 58.98 per dollar, the highest since May 2 last year.

However, the dealer said the RBI would have intervened and bought dollars reserves to cap a sharp appreciation in the Indian currency.

During the day, the rupee moved 23 paise between a range of 58.98 and 59.21 per dollar.

Call rates fall, bond yields up

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 weaker at 7.95 per cent from Friday’s close of 8.45 per cent.

Yield on the benchmark 8.83 per cent Government security, maturing in 2023, hardened to 8.54 per cent from 8.51 per cent on Friday. Prices of the security fell to Rs 101.80 from Rs 102.02.

The bond yields had touched a four-month high of 8.51 per cent last week and expected to decline further going ahead.

Published on June 9, 2014 10:20