The rupee was trading weak by 25 paise at 61.80 against the dollar at 4.10 p.m. local time on fresh demand for dollar from banks and importers.
The rupee gained 20 paise to 61.35 per dollar against the previous close of 61.55 on the back of firm domestic equity market.
The domestic unit had ended weak on Monday as the wholesale price index-based inflation rose to 6.46 per cent in September, dampening hopes that the Reserve Bank of India will cut rates in its second quarter review of monetary policy on October 29.
In New York market, the dollar edged down against some currencies yesterday as the US approached its debt limit with congressional leaders trying to work out a deal on the Capitol Hill.
In the absence of significant macro-economic indicators at home, currency traders will look at the US policymakers as they are locked in a battle over the country’s debt limit.
“The market will continue to remain volatile amid US debt ceiling issue. Although an 11th hour decision is expected from the US, the market will be witnessing jerks till then,” said Abhishek Goenka, Founder and CEO, India Forex Advisors.
Call rates, bond yields
The inter-bank call money rate, the rate at which banks borrow from each other to meet their short-term fund requirements, opened higher at 9.10 per cent against the previous close of 8.95 per cent.
The 7.16 per cent government security, which matures in 2023, opened lower at Rs 90.56 against the previous close of Rs 90.86. The yields hardened to 8.62 per cent from the previous close of 8.57 per cent. Bond yields and prices move in opposite directions.
