The rupee erased its initial gains and was trading weak by 10 paise at 58.60 against the dollar at 1.39 p.m. local time on mild demand for dollar from banks and importers despite robust inflows into the domestic equity market.
The rupee opened marginally higher at 58.46 per dollar against the previous close of 58.50. It hovered in the range of 58.41-58.61 in the morning trade.
The domestic unit had posted its biggest single-day gain last week on Thursday closing 31 paise higher at 58.47.The Indian unit has appreciated over 4 per cent since the beginning of this year from 61 level.
The overnight call money rate (the rate at which banks borrow money from each other to overcome short-term liquidity mismatches) opened lower at 8.10 per cent from Friday’s close of 8.50 per cent.
The yield on the benchmark 8.33 per cent, maturing in 2023, hardened a tad to 8.64 per cent from the previous close of 8.63 per cent on Friday. Prices of the security fell to Rs 101.18 from Rs 100.22. Bond yields and prices move in opposite directions.