The rupee extended its gains for the second straight session today, moving up by another 3 paise to close at 64.30 a dollar on persistent selling of the American currency by exporters and also helped by falling inflation. Inflation based on the wholesale price index fell to a five-month low of 2.17 per cent in May, which boosted investors’ expectations that the RBI may finally snip rates. The rupee resumed slightly higher at 64.32 as against the yesterday’s closing level of 64.33 at the Interbank Foreign Exchange (Forex) Market and hovered in a range of 64.2325 and 64.3625 before ending at 64.30 per dollar, showing a gain of 3 paise or 0.05 per cent. The rupee has gained by 14 paise, or 0.22 per cent, in two days.
In overseas market, the dollar remained pinned in a narrow range today ahead of an expected US interest rate hike. The dollar index, which tracks the US currency against a basket of six major rivals, was up 0.06 per cent at 97.06. The benchmark BSE Sensex rose by 52 points to close at 31,155.91 points today in a volatile trade as oil and gas, banking and pharma stocks gained amid positive global cues. In cross-currency trades, the rupee dropped against the pound sterling to end at 81.93 from 81.87 a pound but rose against the euro to settle at 72.06 from 72.13 earlier.
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The domestic currency also advanced against the Japanese yen to finish at 58.28 per 100 yens from 58.45 yesterday. Foreign funds sold shares net Rs 312.40 crore yesterday as per provisional figures issued by stock exchanges. Meanwhile, the benchmark Sensex moved up further by 52.42 points, or 0.17 per cent, to close at 31,155.91 today. In forward market today, premium for dollar showed a steady trend due to lack of market moving factors. The benchmark six-month premium payable in November and the far forward May 2018 contract ended unchanged at 136-138 paise and 279-281 paise, respectively.