Flow Outlook Spurs Rupee To One-Month High
Mumbai: Today, the rupee climbed to its peak level within a month, driven by the viewpoint of soaring investment flows into Asia’s third- biggest economy.
In morning, the rupee was at 40.54/55 a dollar, which is its highest peak since June 6, and strengthening from Monday's 40.65/66.
The chief dealer with the foreign bank anticipating the rupee to trade in a 40.52-40.62 rannge today said, “The positive signals from Asian equities are leading the market to believe that the stock market will do well, and that the inflows will be good.”
He stated that the RBI was expected to get involved at around 40.52 to restrict the rupee’s advancements.
Since early May, the rupee has been trading in a 40.50-41.25 range, and the central bank is broadly assumed of buying dollars to hold the local currency frailer than 40.50, though over the last three weeks it was seen assuring the rupee did not firm beyond 40.70.
In late May, the rupee hit a nine-year high of 40.28, but was dropped its crest by distrusted central bank involvement. It has benefited about 9 per cent during the recent year, driven higher by vigorous capital flows into the aggressive economy.
Foreign funds have poured $5.7 billion into Indian equities this year, after investing about $8 billion in 2006.