Rupee closes 11 paise stronger at 60.08 per dollar1 min read . Updated: 02 Jul 2014, 12:36 AM IST
The rupee opened at 60.11 a dollar from its Monday's close of 60.19 and hit a high of 60.05 and a low of 60.19
Mumbai: Dollar inflows from foreign institutional investors (FIIs) into the stock market pushed up the rupee against the dollar on Tuesday, even as demand for the US currency from state-owned banks checked gains.
The home currency opened at 60.11 a dollar from its Monday’s close of 60.19 and touched a high of 60.05 and a low of 60.19. The rupee ended at 60.08, up 0.2%.
“There are inflows in the market. They were there yesterday as well, but clearly, demand from state-owned banks is preventing the rupee from rising," said a dealer with a private bank.
India’s equity benchmark S&P BSE Sensex closed at 25,516.35 points on BSE, up 0.4%, helped by investments from FIIs. Since the beginning of this year, the rupee has gained 2.87% against the dollar, while FIIs have bought $9.92 billion from local equity markets.
Dollar demand was strong particularly at levels of 60 per dollar, dealers said, who felt the central bank may not want the rupee to rise beyond this level.
“All eyes are now on the Union budget next week. Where the rupee is headed from here will depend a lot on how the budget is perceived by the markets," the private bank said. The budget will be presented on 10 July.
The yield on India’s 10-year benchmark bond ended at 8.737%, compared with its Monday’s close of 8.748%. Bond yields and prices move in opposite directions.
The dollar index, which measures the U.S. currency’s strength against major currencies, was trading at 79.807, up 0.03% from its the previous close of 79.775.