The rupee ended the day at 58.59 against the dollar.
It had opened at a 11-month high of 58.53 against the dollar riding high on the Narendra Modi-led win by the NDA at the national elections and subsequent inflows in domestic equity markets.
Persistently heavy dollar inflows have helped the rupee surge to 58 levels from 60 per dollar during the week as foreign investors invested on hopes of a pro-investment NDA government at the Centre.
Shubhada Rao, Chief Economist at YES Bank, said, “With election related uncertainty now behind us, FII inflow into domestic markets is likely to remain supportive…While we continue to expect US Dollar per rupee close to 58 levels by Dec 2014, we now expect the currency to largely trade in the range 59-60 in H1 FY15 vis-à-vis our estimate of 60-61.”
Call rates, G-Sec yields fall
The overnight call money rate (the rate at which banks borrow money from each other to overcome short-term liquidity mismatches) opened higher at 8.25 per cent from its previous close of 7.50 per cent.
The yield on 10-year benchmark 8.83 per cent bond, maturing in 2023, softened to 8.80 per cent from Friday’s close of 8.83 per cent. Bond prices rose to Rs 100.15 from Rs 99.97 . Bond yields and prices move in opposite directions.