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The rupee on Tuesday strengthened 11 paise against the dollar to close at 62.20 ahead of the Union Budget announcement and US Federal Reserve chief’s testimony to the Congress.
The Union Budget on Saturday, February 28, will see crucial announcement on numbers relating to the fiscal deficit and the roadmap for the next five years.
The Indian currency had closed at 62.31 on Monday.
The unit opened at 62.26 on mild inflows into the domestic equity market. Volatility in equity market weighed on the rupee, which declined to 62.33 against the dollar. Towards the end of the trading session, the rupee pared the losses to strengthen to 62.20.
Market participants will continue to watch out for directions from the central government from the Railway Budget on February 26 and the annual economic survey on February 27.
Bond and Call rates
The 10-year benchmark 8.40 per cent government security maturing in 2024 hardened a tad to 7.71 per cent from 7.70 per cent. The prices declined to Rs 104.51 from the previous close of Rs 104.61. Bond prices and yields move in the opposite direction.
The overnight call money, rates at which banks borrow from each other due to liquidity mismatches, ended sharply weaker at 6.75 per cent from Monday’s close of 8 per cent. Intra-day, it moved in a wide range between 6.50 per cent and 8.20 per cent.
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