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The rupee on Tuesday closed 6 paise weaker at 60.13 against the dollar due to demand for the American currency from oil importers and banks despite robust inflows into the domestic equity markets.
The Indian unit had ended at 60.07 on Monday. Ease in inflation numbers announced on Monday and healthy capital flows limited the rupee fall.
The unit opened softer at 60.11 on Tuesday and appreciated to 60.07 on inflows into the equity markets and continued sentiments of drop in inflation data.
Wholesale index inflation rose the slowest in four months at 5.43 per cent in June, while consumer price inflation slowed to 7.31 per cent from 8.28 per cent previously.
However, the rupee declined to 60.24 on dollar demand during the day.
The easing inflation could not lift rupee…Due to scanty rainfalls in June, there is a growing fear of damaged summer crops and hence an increased food inflation. The pressure of high inflation may also further deter RBI from easing monetary policy to support India’s growth, said a note by India Forex Advisors.
Call money rates, yields drop
The inter-bank call money rates, the rate at which banks borrow short-term funds from each other to tide over liquidity mismatches, ended lower at 8.50 per cent from the previous close of 8.95 per cent.
The benchmark 8.83 per cent Government security which matures in 2023 surged to Rs 100.58 as against Rs 100.29 on Monday, while yields softened to 8.73 per cent from 8.78 per cent.
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