Due to foreign investment inflows into regional debt and stock markets, the Indian rupee reached a more than one-month high versus the US dollar on Tuesday.
With its strongest session this month, the rupee had a close of 79.1475 against the dollar as opposed to the previous close of 79.5225. The local currency rose to its highest level since August 5 at 79.0350 in the middle of the session. The Chinese Yuan and the Indonesian Rupiah, in contrast, underwent minimal alteration.
A trader at a state-run bank in Mumbai claimed that the rupee’s ability to open above the crucial 79.40 barriers served as another catalyst for the USD/INR pair’s decline toward the 79 levels. The rupee was bolstered by expectations that Indian bonds will be included in international indices as well as by falling oil costs.
After purchasing Indian stocks for approximately $6.5 billion last month, foreign investors have spent around $1 billion so far in September. Since the beginning of August, less than $500 million has been invested overseas in debt. Although oil prices increased on Tuesday, they were still down for the month.
Before the important U.S. inflation data, which is predicted to show a decrease in the headline inflation rate and an increase in core inflation, the dollar index fell. While Indian stocks hit their highest level since April, rupee forward premiums increased somewhat.
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