P3_Indian_Rupee_Rises_to_Four-Month_High_on_Record_Stock_Inflows

P3_Indian_Rupee_Rises_to_Four-Month_High_on_Record_Stock_Inflows

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Unformatted text preview: Bloomberg Indian Rupee Rises to Four-Month H igh on Record Stock In flows September 29, 2010, 8:19 AM EDT By Anil Varma Sept. 29 (Bloomberg) -- India's rupee rose to its strongest level in more than four months as overseas investors pumped record funds in to local shares this year to benefit from the nation's relatively fast economic growth. The currency has gained 4.7 percent in September, the biggest monthly advance since May 2009. Foreigners have invested a net 834.7 billion rupees ($18.6 billion) in Indian stocks in 2010, according to data released yesterday by the Securities and Exchange Board of India. The rupee also gained as an index that measures the dollar's strength fell to a sevenmonth low, signaling weaker demand for the greenback. "The rupee is sustaining i ts positive bias as fund in flows remain strong and the dollar has taken a beating," said Naveen Raghuvanshi, a currency t rader at Development Credit Bank L td. in Mumbai. "Further gains may depend on the central bank's comfort with the possible impact of the rupee rally on exports." The Indian currency climbed 0.5 percent to 44.95 per dollar as of the 5 p.m. close in Mumbai, according to data compiled by Bloomberg. I t rose as high as 44.835 earlier, the highest level since May 10. The rupee may reach 44.75 this week, Raghuvanshi predicted. Offshore forwards indicate the rupee will t rade at 45.52 to the dollar in three months, compared with expectations of 45.79 yesterday. Forwards are agreements to buy or sell assets at a set price and date. Nondeliverable contracts are settled in dollars. India's gross domestic product expanded 8.8 percent in the last quarter from a year earlier, outpacing growth of 3 percent in the U.S., 1.9 percent in the 16-nation euro region and 2.4 percent in Japan. The Dollar Index, which t racks the greenback against the currencies of six major U.S. t rading partners, fell as much as 78.616, the lowest level since Jan. 28, data compiled by Bloomberg show. --Editors: Andrew Janes, James Regan ...
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This note was uploaded on 05/02/2011 for the course FINANCE 9924603 taught by Professor Ssgdbfb during the Spring '11 term at Kyung Hee.

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