The rupee on Monday signed off the last trading session of 2018 with 18 paise gains at 69.77 per dollar but clocked a 9.23 per cent fall during the year after witnessing its one of the tumultuous years in the recent past. On year-over-year basis, the rupee depreciated by a whopping 509 paise, or 9.23 per cent, as compared to 2017-end level of 63.87. Forex traders, however, said fundamentals are supportive for the rupee over the next 6-12 months amid supportive growth momentum, robust forex reserves.
"Attractive real yields (net of inflation), growth momentum and robust forex reserves of $394 billion and USD (dollar) stabilisation is likely to be positive for the INR (rupee)," global financial services major Standard Chartered said in a research note.
However, in the near-term, the trend in the US dollar, oil price and ensuing general elections will determine the direction for the local unit, it noted.
The rupee opened higher at 69.76 per dollar as against Friday's closing level of 69.95 at the Interbank Foreign Exchange (Forex) market and hovered in a range of 69.95 and 69.74 before ending at 69.77 per dollar, showing a gain of 18 paise.
The rupee has gained 58 paise in the last two trading sessions.
Meanwhile, the dollar index was trading down by 0.26 per cent at 96.15 against a basket of six currencies in the late afternoon trade.
Domestic equity benchmarks Sensex and Nifty on Monday ended the last trading session of 2018 on a sluggish note but clocked gains for the third straight year in a row amid positive cues from global markets and strengthening rupee.
Brent crude, the international benchmark, was up 2.27 per cent at $54.42 per barrel.
Foreign funds pulled out Rs 326.87 crore from the capital markets on a net basis, while domestic institutional investors bought shares worth Rs 321.98 crore Monday, provisional data showed.
The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 69.7923 and for rupee/euro at 79.7805. The reference rate for rupee/British pound was fixed at 88.5488 and for rupee/100 Japanese yen at 63.21.