MUMBAI: The Indian rupee ended higher on Monday for a ninth straight session, fuelled by speculative bets its recent winning streak will continue.
The rupee settled at 82.8800 to the US dollar compared with its previous close of 82.9225. The rupee rose to 82.7800 intraday, the highest in more than four months, but trimmed gains on importers’ dollar demand, dealers said.
The rupee has surged, breaking beyond its “pivotal thresholds” of 83.00 and 82.90, Amit Pabari, managing director at FX advisory firm CR Forex, said.
Investors are betting the rupee will break out of its recent narrow range and rally this year.
“The current momentum suggests a probable continuation of this upward trend, with a further advancement towards the 82.50 mark in the near term,” Pabari said.
The rupee was also helped by a slide in US Treasury yields after the producer price index data boosted the odds of a Federal Reserve rate cut in March. US producer prices unexpectedly fell in December.
The 10-year Treasury yield dropped to near 3.95% on Friday, down nine basis points for the week, while the two-year yield fell 25 basis points last week.
The fall in US bond yields pushed dollar-rupee forward premiums higher. The USD/INR one-year implied forward rose to 1.92%, up 17 basis points this month.
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