The rupee on Friday fell by 11 paise to close at 53.81 against the dollar due to a weaker euro and mild capital flows.

The domestic unit had opened flat against Thursday’s close of 53.70 on a firm euro. Sustained dollar sales by exporters and banks along with positive domestic and Asian equity markets had boosted the rupee to an intra-day high of 53.60 per dollar in the first session.

However, tracking the euro, which fell to a three-week low against the greenback, the rupee weakened to 53.86 as uncertainty on Greece and Spain bailout capped the gains.

In addition, US Payrolls data released late on Friday indicated that the country added more jobs in October and revised upwards the job addition numbers for August and September. This could afford some level of strength in the US currency, which might have an adverse impact on the rupee next week.

“Amid commodity prices falling and monetary easing hopes, there is an increase interest in dollar buying. Hence, we see the rupee staying at 54.30 to 54.30 resistance levels in the coming week,” said Bitupan Majumdar, Head, FX Derivatives, JRG Wealth Management.

“The rupee may continue to trade around 53 levels as concerns on current account deficit continue to remain under pressure on worries of slowing euro and US economic growth,” Majumdar added.

Call Rates and G-Secs

The overnight call money rates ended lower at 7.95 per cent. The call rates had opened slightly higher at 8.05 per cent from its previous close of 8 per cent. Intra-day, it moved between the 7.90 to 8.10 per cent range.

The 10-year benchmark 8.15 per cent government security, which matures in 2022, closed lower at Rs 99.67 from the previous close of Rs 99.76 on Thursday, while the yield remained almost unchanged at 8.19 per cent.

(This article was published on November 2, 2012)
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