The Indian Rupee is heading for a third weekly gain against the US Dollar, extending its longest winning streak against the ‘Greenback’ since February.
The gains come after the Reserve Bank of India tightened the supply of cash as its attempts to halt the Rupees decline. The RBI has raised two interest rates and restricted lenders access to funds in the past two weeks, sending the benchmark 10-year bond yield to a 14-month high.
“Such comments are, indeed, what markets would like to hear, as they improve communication of policy intentions,” Dariusz Kowalczyk, a strategist at Credit Agricole CIB said in an e-mail interview with Bloomberg today. “The measures amount to significant tightening and were a mistake as their negative impact on market rates, confidence and growth will be bigger than the positive impact on the Rupee.”
The Indian Banks actions are in response to the decline in foreign holdings of Indian debt which began in May as a result of the US Federal Reserve first signalling that it could curb its asset purchasing programme. Debt holdings have declined by $9 billion since May 22nd.
“By stabilizing the rupee, we will also enhance the possibility of stronger growth,” the finance ministry’s Rajan said. “Because the inflationary consequence will be contained and, hopefully over time, that will give RBI room to be more accommodative.”
Current Rupee (INR) Exchange Rates
The Pound Sterling/ Indian Rupee Exchange Rate is currently in the region of: 90.7186
The Euro/Indian Rupee Exchange Rate is currently in the region of: 78.2629
The US Dollar/Indian Rupee Exchange Rate is currently in the region of: 58.8883
The Australian Dollar/Indian Rupee Exchange Rate is currently in the region of: 54.6643
The New Zealand Dollar/Indian Rupee Exchange Rate is currently in the region of: 47.6136
The Canadian Dollar/Indian Rupee Exchange Rate is currently in the region of: 57.3482
(Correct as of 11:40 am GMT)
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