The Indian rupee surged to a six-month peak on Thursday, buoyed by persistent buying of local bonds by foreign investors in anticipation of the nation’s upcoming inclusion in global debt indexes. The rupee strengthened by 0.1% to reach 82.7250 per dollar, marking its highest level since September 4.
A combination of factors contributed to the rupee’s ascent, including a weakened US dollar, a rally in domestic equities, and continued inflows of foreign funds. With these supportive elements in play, the local currency has appreciated by 0.5% since the beginning of the year, positioning it as the top-performing currency in Asia.
Meanwhile, the dollar index, which measures the greenback against a basket of major currencies, edged lower to 103.22. This movement occurred as the index hovered near its one-month low reached on Wednesday. The decline was attributed to a drop in US bond yields following the release of data indicating some softening in the labor market. Additionally, remarks by Federal Reserve Chair Powell, which were perceived as less hawkish than anticipated, also contributed to the dollar’s weakening, as reported by Reuters.
