The rupee closed flat for the fourth day in a row in the absence of any positive or negative indicators for the currency locally and globally. The Indian unit closed at 61.55 against the American currency. Previous close was 61.54. The rupee had opened higher at 61.50 and then further strengthened to 61.32 amid dollar selling by exporters and banks. However, oil related import demand weakened the rupee towards the final session.

Inflation data, which has come off in December from highs witnessed earlier, is likely to enhance market expectations of a rate cut when the RBI meets on January 28. This should provide some succour to the Indian unit.

Traders believe that the rupee will trade in the 61.25-61.75 band next week.

Call rates up, bond yields steady

The inter-bank call money rate, the rate at which banks borrow short-term money from each other, closed higher at 8.85 per cent against the previous close of 8.80 per cent.

Yield on the benchmark 8.83 per cent government bond, maturing in 2023, ended almost flat at 8.63 per cent from the previous close of 8.61 per cent. The price fell a tad to Rs 101.31 against previous close of Rs 101.38.

(This article was published on January 17, 2014)
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