Rupee ends stronger on Fed comments

The rupee strengthened on Thursday after the US Federal Reserve indicated interest rates are likely to remain lower for some more time, pushing the dollar sharply lower, but high global crude oil prices checked gains in the local currency.

The partially convertible rupee ended at 60.08/09 to the dollar versus its previous close of 60.39/40. Earlier in the day, the rupee had briefly come off highs after Reuters reported India plans to clear some pending oil payments to Iran through the United Arab Emirates central bank, citing three sources with knowledge of the matter.

Government bond prices declined further due to sustained selling from banks and corporates. The overnight call money rate recovered following good demand from borrowing banks amidst tight liquidity conditions in the banking system. The 8.83 per cent government security maturing in 2023 dropped to Rs 100.89 from Rs 101.00, while its yield gained to 8.69 per cent from 8.67 per cent previously.

The overnight call money rates finished higher at 7.90 per cent from Wednesday's level of 7.05 per cent. It moved in range of 8.35 per cent and 7.65 per cent.