Re hits 7-month high as foreign inflows continue

The rupee rallied to its highest level in nearly eight months on Tuesday as sustained foreign fund inflows into the stock market boosted the currency at the forex market. The currency commenced strong at 60.60 a dollar from previous close of 60.77 and rose to a high of 60.44 before settling at almost eight-month high […]

The rupee rallied to its highest level in nearly eight months on Tuesday as sustained foreign fund inflows into the stock market boosted the currency at the forex market.

The currency commenced strong at 60.60 a dollar from previous close of 60.77 and rose to a high of 60.44 before settling at almost eight-month high of 60.48, a rise of 29 paise from its previous close.

The rupee is set to continue trading with an upward bias, helped by the rally in the stock market with the upcoming national elections being the key focus point.

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Foreign funds bought shares worth $240 million on Monday, taking their total purchases in 2014 to $2.6 billion. Foreign inflows into the debt market stand at a net $5.9 billion so far this year.

Bankers expect the RBI to buy dollars heavily if the rupee level strengthens to 60-59 level. “We remain constructive on the rupee, though we don’t see the rupee breaching 61 on a sustained basis,” Deutsche Bank said in a report.