After hitting a three-week low on Tuesday, the rupee ended almost flat from its previous close at 53.84 against the dollar due to weak factory output and high January inflation numbers.

Pulled down by manufacturing sector, factory output released on Tuesday declined 0.6 per cent in December 2012, while retail inflation increased to 10.79 per cent in January from 10.56 per cent in December.

The Indian unit had lost 35 paise on Monday to end at nearly two-week low level of 53.85.

On Tuesday, it opened weak at 54 against the dollar at the Interbank Foreign Exchange market on sustained demand for the US currency from importers.

Post the industrial data, the domestic currency touched 54.07 in the afternoon trades before recovering to 53.84 per dollar.

Amid increased demand for the American currency from importers, concerns raised by Reserve Bank of India Governor D Subbarao on Monday about country’s current account deficit heading to its highest ever this fiscal, have also put pressure on the rupee.

In addition, lower IIP numbers have raised concerns of a pause in further rate cut in key policy rates by the RBI creating negative sentiments for the rupee.

Call rates and G-Secs

The inter-bank call rates ended at 7.75 per cent from Monday’s close of 7.85 per cent. It moved in the 7.70 and 7.90 per cent range.

The 10-year benchmark 8.15 per cent government security, which matures in 2022, closed at Rs 101.82 from the previous close of Rs 101.89, while the yields remained unchanged at 7.86 per cent.

(This article was published on February 12, 2013)
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