The rupee firmed up further by 4 paise to close at 61.69 against the American currency on sustained selling of dollars by banks and exporters.
The rupee resumed higher at 61.70 at the Interbank Foreign Exchange (Forex) and firmed up further to 61.67 on initial selling of dollars by banks before ending a 61.69 per dollar, a gain of 4 paise from its last close.
The domestic currency had gained 2 paise on Thursday. The rupee traded in a narrow band on Friday, analysts said. "Some banks were seen selling dollars in the market which helped rupee to post its fifth weekly gain in six weeks. But RBI is not expected to let the rupee appreciate too much as it would hurt the exports.
The trading range for the Spot USD/INR pair is expected to be within 61.20 to 62.20," Veracity Group CEO Pramit Brahmbhatt said.
"Importer demand and purchases from state banks for defence related payments limited appreciation. However, continued foreign funds into the local domestic markets limited depreciation," Admisi Forex India Director Suresh Nair said. Meanwhile, the benchmark BSE Sensex dropped further by 133.06 points or 0.46 per cent to close at 28,717.91. The dollar index was up by 0.20 pct against a basket of major global rivals.
The forward premia edged up on paying pressure from corporates. The benchmark six-month premium payable in July inched up to 219.5-220.5 from 219-221 paise yesterday and forward contracts maturing in January 2016 also edged up to 425-427 from 424-426 paise. The Reserve Bank of India fixed the reference rate for dollar at 61.7363 and for Euro at 70.7868. The rupee dropped further against the pound to 94.61 per pound from 94.09 per pound previously and moved down against the euro to 70.59 per euro from 70.58. It recovered marginally against the yen to 52.58 per 100 yen from 52.60 on Thursday.