Comments
Continuing strong recovery, the rupee was back to 65 levels, posting its biggest single-day gain in 2 years to close at 65.67 against the US dollar.
The Indian unit closed 69 paise stronger on Friday over the previous close.
A relief rally was seen in the forex market after the US Federal Reserve decided yesterday to keep interest rates unchanged at 0-0.25 per cent.
Heavy selling of the American currency by foreign banks took place after the uncertainty ended over the US interest rate hike on late Thursday evening.
The Indian currency opened higher at 66.15 per dollar as against the previous close of 66.46 at the Interbank Foreign Exchange (Forex) market.
The Fed decision to keep interest rates on hold also provides more headroom for the Reserve Bank of India to cut its key policy rates in the upcoming monetary policy review on September 29.
This along with robust domestic equity market and weakness in the American currency against other currencies boosted the rupee sentiments.
US dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down by 0.30 per cent.
Bonds dip, call rates end higher
The yield on10-year benchmark 7.72 per cent Government security due in May 2025 dropped six basis points to its lowest since June 22 at 7.69 per cent from 7.75 per cent on Wednesday. The yield moved between 7.69 per cent and 7.74 per cent. The price rose to Rs 100.13 from Rs 99.75. Bond yields and prices move in opposite directions.
The overnight call money rate, the rate at which banks lend to each other to overcome overnight liquidity mismatches, jumped to 8 per cent from Wednesday’s close of 7.40 per cent.
Comments
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.