The rupee closed at 83.48/$1 on Friday, against an earlier close of 83.46/$1, LSEG data showed. On a weekly basis, the local currency depreciated by 0.1%
US Non Farm Payroll (NFP) data is expected today, which will influence expectations of a rate cut by the Federal Reserve.
The dollar index fell 0.2% to a three-week low at 104.95 on pressure from the euro and the British pound.
Brent crude oil traded at $87.47 a barrel on Friday, up from $86.86 yesterday, Reuters data showed. Oil marketing companies are buying crude in anticipation that it could rise further, traders said.
A rise in crude oil prices poses upside risks to India’s trade deficit and inflation as the country is a major importer of the commodity.
The 10-year benchmark government bond yield closed at 6.99% on Friday, unchanged from the previous close, CCIL data showed.
The Reserve Bank of India conducted an auction of government securities worth Rs. 28,000 crore on Friday.
“The auction cut-off went well. Many participants were concerned that the price cut-off would be on the lower side. The NFP data will now determine whether we are going to 6.95% yield, or if yields will rise”, said a trader at a primary dealership.
The yield for the three-year bond was 6.95%, 7.03% for the 15-year bond and 7.08% for the 20-year bond, RBI data showed.
Nonfarm payrolls data last month are expected to have gained 190,000 jobs, after a 272,000 gain in May, a Reuters poll showed.
RBI data shows that the central bank on July 4 withdrew from banks Rs. 1.33 lakh crore was exploited. Absorption of funds by RBI indicates excess liquidity with banks. Traders are expecting this excess liquidity to last until mid-August due to government bonds maturing at the end of this month.
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