The Indian rupee rose for a second consecutive session on Monday, boosted by dollar selling by corporates and custodian banks, although month-end dollar demand from oil firms could limit a sharp rally in coming days. Gains in the rupee tracked a rally in Indian shares as a drop in global crude prices after Iran clinched a nuclear deal with world powers sparked hopes of reduced inflationary pressures and a narrower current account deficit at home.
"We could see the unit once again gain towards 62 levels this week but oil demand will limit sharp gains," said Hari Chandramgethen, head of foreign exchange trading at South Indian Bank.
The partially convertible rupee closed at 62.50/51 per dollar compared to 62.87/88 on Friday. The unit moved in a 62.44 to 62.70 range during the session.
In the offshore non-deliverable forwards, the one-month contract was at 62.93 while the three-month was at 64.02.
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