 "Rupee ends little changed, yields fall for second straight day")
The Indian rupee ended little changed on Thursday as caution prevailed ahead of a slew of economic data, while dollar demand by state-run banks, which traders attributed to defence and oil-related payments, weighed on sentiment.
The rupee ended at Rs 60.07 compared with previous close of Rs 60.14 per dollar. The rupee had opened at Rs 60.05 and during intra-day trades it touched a high of Rs 60.04 and a low of Rs 60.30.
The data, starting with industrial output on Friday and consumer inflation on Tuesday, comes as voting gets underway in the country's general elections.
Meanwhile, the Reserve Bank of India (RBI) reiterated on Thursday that they do not have a target for the rupee. "We do not have a target for the rupee. RBI is committed to flexible exchange rate regime," said Rudra Narayan Kar, chief general manager-in-charge, RBI at an event held in Mumbai.
A rally in domestic shares on the back of heavy foreign buying has helped support the rupee. "Biggest factor for rupee moves will be election results in May but trade data and inflation numbers will also have limited impact," said Paresh Nayar, head of foreign exchange and fixed income trading at First Rand Bank, adding mixed data is expected around the corner so the market is cautious.
The yield on the 10-year benchmark government bond 8.83% 2023 fell for the second consecutive day on speculation yields higher than 9 percent attracted buyers.
"There was a sense of fatigue after the sharp rally in yields and we have seen some value buying in the last two days," said Anoop Verma, vice president for treasury at Development Credit Bank. The yield ended at 9.00% compared with previous close of 9.03%.