MUMBAI: The Indian rupee ended higher on Friday as mild inflows and exporter dollar sales lifted the currency after it hit an all-time low in the previous session.
The rupee closed at 83.5325 against the US dollar, up 0.1% from its close at 83.6525 in the previous session. It hit a record low of 83.6650 on Thursday.
The currency was little changed week-on-week.
Mild dollar inflows, including those related to the rebalancing of FTSE equity index, alongside dollar sales from exporters helped the currency, traders said.
Despite the fall on Thursday, most analysts and traders expect the Reserve Bank of India to continue intervening to prevent sharp depreciation in the rupee.
Anticipated bond inflows next week, and “strong economic fundamentals coupled with the Reserve Bank of India’s substantial (FX) reserves ... provide a significant cushion to the rupee,” Amit Pabari, managing director at FX advisory firm CR Forex said.
Foreign inflows into Indian bonds are expected to hit a decade-high of $2 billion around June 28, when they will be included in a widely-tracked JPMorgan index.
The dollar index touched an over one-month peak of 105.86 while Asian currencies were mixed. The offshore Chinese yuan was hovering close to 7.29, its lowest level since November 2023.
A second consecutive rate-cut by the Swiss Central Bank and growing expectations that the Bank of England will cut rates in August helped boost the dollar even as economic data continued to point towards cooling in the world’s largest economy.
Fed officials have adopted a largely cautious stance towards future rate cuts in recent remarks.
Comments
Comments are closed.