Rupee extends gains, hits two-week high of 63.91 vs US dollar

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MUMBAI: Extending gains for the third straight session, the rupee on Thursday advanced by 18 paise to close at 63.91 per dollar on sustained selling of the American currency by exporters and banks.

The local unit also got a boost from higher domestic equity markets.

The dollar fell further against the yen to hit a 15-month low in Asian trade while the euro gained after firm German growth, which also supported the rupee’s upmove.

Besides, inflation based on wholesale prices eased to a six-month low of 2.84 per cent in January on cheaper food articles even as vegetable prices continued to rule high.

The rupee gained 18 paise today to end at a two-week high of 63.91 against the dollar, a level last seen on January 31 when it had finished at 63.58.

The rupee moved between 63.98 and 63.87 at the Interbank Forex market.

Yesterday, the rupee had ended 23 paise higher at 64.09 against the dollar.

In other cross-currency trades, the rupee firmed up against the pound sterling to end at 89.79 from 88.76. It also strengthened against the euro to close at 79.73.

The local unit closed at 59.95 per 100 Japanese yens from 59.66 earlier.

The Reserve Bank of India today fixed the reference rate of the rupee at 63.92 against the US dollar, 79.67 for the euro and 60.05 per 100 yens.

Forward spot market rates for July month moved to 129-131 from 134-136 and for January month to 265-267 from previous mark of 270.50-272.50.

The 10-year government bond yield gained nearly seven basis points after surging US treasury yield worried traders that it will curb inflows into the Asian nationâ€[TM]s sovereign debt. Higher international crude oil prices also weighed on sentiment.

India’s 10-year bond yield ended at 7.57 per cent from Wednesday’s close of 7.49 per cent. Bond yields and prices move in opposite directions.

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