The Indian rupee is turning a corner, as massive inflows into the country’s stock markets help the currency break past the central bank’s intervention barrier. Asia’s weakest currency last year is now among its best performers. The rupee has gained 0.6 per cent this year against the dollar.
With investors buying almost $4 billion of stocks this month, the most in Asia’s emerging markets after China, the economy has recovered multifold. The expansive budget policies are luring global funds to India’s equities.
The rupee rose to 72.57 per dollar last week, its highest since March. Analysts surveyed by Bloomberg see the currency hitting that level by the fourth quarter. Economists expect the data to show that India exited a recession with a 0.5 per cent expansion year-on-year in the fourth quarter.