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With a fall in July inflation data, the rupee recovered in the afternoon to trade at 55.62 against the dollar after it touched an intra-day low of 55.76 per dollar on high inflation expectations.
Contrary to market expectations, the inflation for July declined to 6.87 per cent from June inflation at 7.25 per cent. The inflation figures are at its lowest level since January 2010.
The Indian unit had opened weaker at 55.49 against the dollar from its previous close on high inflation concerns. On Monday, it had closed at 55.35 due to heavy dollar demand from oil importers.
The Reserve Bank Governor D. Subbarao, on Monday, had reiterated his concerns on inflation remaining above comfort levels, prodding the government to contain its own borrowing.
Call Rates and G-Secs
The overnight call money rates slipped to 8.10 per cent in its opening trade from yesterday’s close of 8.15 per cent. Currently, the call money rate is trading at 8.05 per cent.
The 8.15 per cent government bond that matures in 2022 was trading higher at Rs 99.78 (yield: 8.17 per cent) from its previous close of Rs 99.62 (yield: 8.20 per cent) on Monday.
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