The rupee was trading up by 17 paise at 61.91 against the dollar at 4.05 p.m. local time.
The domestic unit gained 8 paise to 62 per dollar in the opening trade against the previous close of 62.08 on the back of weakness in the dollar index.
According to traders, the rupee is likely to remain range-bound in the 61.50 to 62.50 level.
November IIP data
Market players are also maintaining a cautious stance ahead of the inflation data due next week.
The inflation numbers, which are expected to ease, will be watched out for further cues on determining the interest rate decision by the Reserve Bank of India on January 28.
Abhishek Goenka, Founder and Chief Executive Officer of India Forex Advisors said that all eyes will be fixed on November IIP data. It is likely to show a modest growth helped by better overseas demand, after shrinking for the first time in four months in October (-1.8).
Call rates, G-Secs
The inter-bank call money rate, the rate at which banks borrow short-term money from each other, opened higher at 8.25 per cent from the previous close of 8.3 per cent.
Yield on benchmark 8.83 per cent government bond, maturing in 2023, softened to 8.78 per cent from the previous close of 8.79 per cent. Prices ended higher at Rs 100.30 from Rs 100.24.
According to agency reports, government bonds rose as investors were assuaged by comments from a Reserve Bank of India deputy governor that a proposed debt switch may happen only in the next fiscal year starting April.
