by: Ravindra N.
The Indian rupee on Monday strengthened against the US dollar tracking the gains in the local equity and Asian currencies markets. The rupee gained for the ninth consecutive session, its longest winning streak since June 2011.
Traders are cautious ahead of an event heavy week.
The local currency opened at 67.21 a dollar and touched a low of 67.20, a level last seen on 11 November 2016. At 9.15am, the home currency was trading at 67.22, up 0.17% from its previous close of 67.32.
The Reserve Bank of India (RBI) will meet on Wednesday for its bi-month policy. Seven out of 10 bank economists polled by Mint expect RBI to cut its repo rate by 25 basis points to 6%. The other three expect the repo rate to remain unchanged.
India’s benchmark Sensex index rose 0.24% or 69.17 points to 28,309.69. So far this year, Sensex has risen 6.1%.
India’s 10-year bond yield fell to 6.398% from its Friday’s close of 6.409%. Bond yields and prices move in opposite directions. Since the beginning of this year, the rupee has gained 1.05%, while foreign institutional investors (FIIs) have bought $111.40 million from local equity and sold $247.20 million in debt markets.
Asian currencies were trading higher as the dollar weakened after mixed US employment data reduced expectations for a US Federal Reserve interest rate increase in March.
South Korean won was up 0.83%, Taiwan dollar 0.18%, Japanese yen 0.12%, Philippines peso 0.11%, Indonesian rupiah 0.1%, Singapore dollar 0.08% and China renminbi rose 0.07%. However, China offshore spot was down 0.04%.
The dollar index, which measures the US currency’s strength against major currencies, was trading at 99.71, down 0.16% from its previous close of 99.87.