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The rupee closed at 55.63 against the US dollar, almost unchanged from Monday's close. The domestic unit opened at 55.35 and touched an intra-day low of 55.90.
There is more demand for the dollar globally as it is considered a safe bet. The Indian currency has been hammered due to high demand for the US currency from oil importers.
The Euro zone crisis, with Greece and Spain literally in the woods, has severely dented the global investor sentiment.
“India has not been singled out. All high current-account deficit countries have been facing currency depreciation,” Mr Chetan Ahya, Managing Director and Asia-Pacific Economist, Morgan Stanley, said at the 14{+t}{+h}Annual India Summit.
He said that the exchange rate is likely to remain at 56 levels for sometime and soften to about 52 against the dollar by December end.
The benchmark six-month forward dollar premium payable in October edged up to 128-129-1/2 paise from overnight close of 127-129 paise and the far-forward contracts maturing in April also moved up to 246-248 paise from 243-245 paise.
The RBI fixed the reference rate for the US dollar at 55.5615 and for euro at 69.5025.
Bonds stay firm
The uptrend in Government securities (G-Secs) was unabated on sustained buying by banks and corporates. The 9.15 per cent G-Sec maturing in 2024 gained further to Rs 105.9450 from Rs 105.89, while its yield eased to 8.37 per cent from 8.38 per cent on Monday.
The 8.79 per cent 2021 bond also rose to Rs 102.94 from Rs 102.86 previously, while its yield softened to 8.33 per cent from 8.34 per cent.
Call moves up
The call money rate improved further on sustained shortage of funds in the banking system. The overnight rate improved further to settle at 8.25 per cent from 8.20 per cent, after moving in the 8-8.30 per cent range.
The RBI, under the Liquidity Adjustment Facility, purchased securities worth Rs 77,890 crore in 32 bids at the one-day repo auction at a fixed rate of 8 per cent.
>satyanarayan.iyer@thehindu.co.in
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