Adani Group denied the allegations as baseless, while Indian government officials haven't commented so far
business3 days ago
The Indian rupee rose its strongest level on in over two weeks on Monday, boosted by gains in regional peers and likely dollar inflows on account of the rebalancing of MSCI's equity indexes.
The rupee was at 84.30 (22.97 UAE dirham) as of 11am IST, its highest since Nov. 7, up 0.1 per cent from its close at 84.4450 (23 UAE dirham) in the previous session.
While the local unit had declined to its all-time low of 84.5075 (23.02 UAE dirham) on Friday, prompting intervention by the Reserve Bank of India (RBI), a pullback in the dollar index and US bond yields offered some respite on Monday alongside dollar inflows, traders said.
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The dollar index was at 106.9 on the day, down 0.5 per cent from its closing level on Friday, while the 10-year US Treasury yield declined 6 bps to 4.35 per cent.
[Editor's Note: For real-time forex rates, click widget below or visit KT's dedicated Trading News page here.]
The pullback was spurred by markets taking comfort in U.S. President-elect Donald Trump's decision to nominate veteran investor Scott Bessent as the Treasury Secretary.
Asian currencies were mostly higher on the day, with the Korean won up 0.4 per cent and leading gains.
Meanwhile, the rupee also benefited from dollar sales by at least two large foreign banks, likely on behalf of custodial clients, a trader at a state-run bank said.
Indian equities are expected to see passive inflows of about $2.5 billion on account of an MSCI equity index rejig, according to estimates by Nuvama Alternative & Quantitative Research. The rebalancing will be effective after market close on Monday.
The rupee has remained under pressure for the better part of the last two months and has relied on frequent interventions by the RBI to avoid sharp losses.
The central bank's routine interventions though, alongside valuation losses, have pulled India's foreign exchange reserves to a four-month low of $657.89 billion, as of the week ended Nov. 15.
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