The domestic unit resumed higher at 61.46 per dollar against yesterday’s closing level of 61.34 at the Interbank Foreign Exchange (Forex) market.
It hovered in the range of 61.01 and 61.61 per dollar during the afternoon trade.
Crude oil prices rose in early trade, though hefty supplies capped the price gains and outweighed concerns that rising tensions in West Asia could disrupt supply.
In New York, the US dollar held near a four-year high against its major rivals in early trade, and further gains looked likely for the currency as it boasted its biggest yield advantage over the euro in 15 years.
The rupee scripted a late recovery on Friday to close at 61.15 against the dollar, after Standard and Poor’s raised the country’s sovereign rating outlook.
The Indian unit had closed at 61.34 on Thursday. During intraday trade on Friday, the Indian unit slumped to a low of 61.62, before the recovery began.
Next week, the rupee’s movement will be dictated by the RBI’s monetary policy statement on Tuesday. Traders expect the rupee to trade in the 60.80 to 61.80 range next week.
Government bond (8.40 per cent G-Sec, maturing in 2024) yields softened to 8.44 per cent from previous close of 8.49 per cent. The price of the security ended higher at Rs 99.70 from previous close of Rs 99.40.
The interbank call money rates, or the rates at which banks borrow short-term funds from each other, closed lower at 7.10 per cent from previous close of 7.95 per cent.