Mumbai: Rupee saw the biggest weekly increase in four months on Friday as investors opened a long dollar position ahead of the chairman of the US Federal Reserve Jerome Jackson speech hole in the future.
The rupee converted partly ended the session at 73.68 / 69 per dollar, better than the closing Thursday 74.2150.
The unit rose 1% this week, the best since the last week of April.
“Suddenly there was pressure to cut the dollar in the afternoon trade because investors were not sure that the Fed would announce announcing something concretely on the purchase of tonight’s assets,” said a senior trader at a private bank.
Reserve Bank of India (RBI) did not come too strong to prevent rupee appreciation because of the small market flow, the merchant said, adding that the purchase of the sporadic dollar with the country’s lenders could be on behalf of the central bank.
The market focused this week on the Fed signal at the Jackson hole conference, but analysts now doubt whether the central bank’s boss will provide instructions on tapered time.
However, most of the currencies and other Asian stocks weakened because traders cut risk exposure ahead of Powell’s speech.
Investors cut bearish bets in most Asian currencies because the dollar weakened at the hopes of the pushback while in the tapered timeline of the Federal Reserve, while sentiment on Rupee changed a little bullish, a Reuters poll showed on Thursday.
“We hope that RBI remains proactive with FX intervention strategies to ensure limited volatility in rupees, and continue to estimate the rupee to end the year at 75 versus the dollar,” Kaushik Das, chief economist at Deutsche Bank, wrote in a note.
In the domestic bond market, the 10-year bond yield ended steady that day but rose 2 bps on that week.
Rupee posted the best week in 4 months before the Jackson hole speech
