The Indian rupee extended its rally into a sixth straight session on Thursday, surging 0.76 percent to a new seven-month closing peak on a flood of foreign investment and trade inflows. The rupee closed at 44.1050/1250 per dollar, but off a 44.05 peak following central bank intervention and the imposition of a $500 million investment limit on foreign funds' purchases of local corporate debt. The local currency has now gained 2.14 percent since last Wednesday and 3.4 percent so far in 2004.
The rupee, which last closed higher at 44.0350/0450 on April 23, is now eyeing the 51-month peak of 43.5450/5500 posted in early April, before election jitters and a change in government caused it to lose ground for a few months.
A strong revival in foreign portfolio investments into local assets is helping underpin the rupee's rally. Foreign funds' net purchases of Indian shares are at a record annual high of more than $7 billion so far in 2004.