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The rupee gained over one per cent to end at 54.85 against the dollar after the government agreed for a debate followed by a vote on the contentious policy of FDI in multi-brand retail.
Soon after the government’s announcement, the Parliament started functioning after a hiatus of four full days. This also paves the way for other important bills like insurance, pension and banking reforms getting passed in the crucial winter session.
The rupee had opened lower at 55.56 (previous close: 55.45 on Tuesday) as oil importers scrambled for the American currency to cover their month-end demand.
The Indian unit has also broadly followed the gains in domestic equity markets.
The domestic equity market rally was spurred by Goldman Sachs upgrading India to “overweight,” from “market-weight”.
Concerns over the impending fiscal cliff in the US will keep the rupee on the boil over the next fortnight.
Call rates, G- Secs
The interbank call rates, which ended at 7.95 per cent on Tuesday, closed higher at 8.05 per cent.
The 8.15 per cent government security, maturing in 2022, closed lower at Rs 99.63 (yield: 8.20 per cent) from previous close of Rs 99.73 (yield: 8.19 per cent) on Tuesday.
satyanarayan.iyer@thehindu.co.in
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