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The rupee snapped its losing streak and ended much stronger at 63.30 against the dollar on the back of inflows into the domestic equity markets.
The benchmark Sensex closed 206.50 points higher at 18519.44 points.
The Indian unit, which had closed at 64.40 on Thursday, opened at 64.30.
Sugandha Sachdeva, Assistant Vice-President, Currency Research, Religare Securities, said: “The capital control measures taken by RBI further heightened the fears of uncertainty in the forex market. Moreover, increasing gold imports are creating more fears of widening CAD.”
“However, the fall is too steep and these high levels of rupee are unsustainable. Government’s measures to reduce capital controls and imports and infusion of foreign investment should support the rupee. We expect the rupee to appreciate to 63.50 levels in 10-15 days,” Sachdeva added.
Call rates steady; Bond yields harden
The benchmark 7.16 per cent government security, which matures in 2023, closed lower at Rs 92.70 from the previous close of Rs 92.88. Yields on the security hardened to 8.26 per cent from the previous close of 8.23per cent.
The call money rate, rate at which banks borrow from each other for short-term funding, closed marginally lower at 10.20 per cent from the previous close of 10.25 per cent.
satyanarayan.iyer@thehindu.co.in
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