BLBG: India Rupee Gains to One-Week High on Stock Inflows, Oil Drop
By Anoop Agrawal
Nov. 25 (Bloomberg) -- India’s rupee advanced to its strongest level in more than a week as a rally in Asian stocks boosted investor demand for emerging-market assets.
The local currency headed for a weekly gain after global funds bought $128.4 million more Indian equities than they sold in the first two days of the week, bringing inflows to a record $15.3 billion this year. The rupee also rose on speculation the nation’s refiners trimmed purchases of dollars after crude oil for January delivery declined to a five-week low yesterday in New York.
“Investors are optimistic that fundamentals will improve sooner than later, and that is getting reflected in equities rising,” said Naveen Raghuvanshi, a trader at Development Credit Bank Ltd. in Mumbai. “The rupee is poised to advance further.”
The rupee rose 0.2 percent to 46.30 per dollar as of 10:02 a.m. in Mumbai, according to data compiled by Bloomberg. It earlier reached 46.25, the strongest level since Nov. 18. The currency has strengthened 3.8 percent this quarter, the best performance among Asia’s 10 most-active currencies excluding the yen.
Offshore contracts indicate bets the rupee will trade at 46.36 to the dollar in a month, compared with expectations of 46.40 yesterday. Forwards are agreements in which assets are bought and sold at current prices for future delivery. Non- deliverable contracts are settled in dollars rather than the local currency.
The benchmark Bombay Stock Exchange’s Sensitive Index advanced 0.6 percent today, bringing gains to 78 percent this year. The MSCI Asia Pacific Index rose 0.6 percent and the gauge has climbed 66 percent from a more than five-year low on March 9.
To contact the reporter on this story: Anoop Agrawal in Mumbai at aagrawal8@bloomberg.net
