Rupee trades higher at 63.87 per dollar

Mumbai: The Indian rupee on Friday strengthened against the dollar in the mid-day trading sessions as local equity markets turned positive after three days of losses.

At 2pm, the home currency was trading at 63.87, up 0.18% from its previous close of 64.01. The local unit opened at 63.97 per dollar.

The Sensex rose 0.49% or 131.29 points to 26,944.71 points.

The bond yield gained for the fourth consecutive session; in this week, it gained 17 basis points, its biggest weekly gain in 14 months.

One basis point is a hundredth of a percentage point.

The yield on India’s 10-year benchmark bond was trading at 7.807% compared with its Thursday close of 7.795%. Bond yields and prices move in opposite directions.

Since the beginning of this year, the rupee has lost 1.5%, while foreign institutional investors have bought $6.95 billion from local equity and $6.09 billion from bond markets.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 95.435, down 0.03% from its previous close of 95.461.

Traders were cautious ahead of the May US employment report and Greece’s loan repayment deadline on Friday. Analysts expect the US to add 225,000 jobs in May, while Greece is scheduled to repay $1.76 billion to the International Monetary Fund (IMF) on 5 June, Reuters reported.

The IMF on Thursday called for the Federal Reserve to hold off on its first-rate increase until 2016 as it slashed its forecasts for the US economic growth.