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Rupee Rally Continues, Hits 18-Month High Against Dollar

Rupee also gained from strong $6.1-billion foreign investment into debt and equities this month.
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The rupee rose to fresh a 17-month high against the US dollar on Monday.
The rupee rose to fresh a 17-month high against the US dollar on Monday.
New Delhi: The rupee hit a nearly one and a half year high against the dollar on Monday, continuing its recent gains against the greenback. The rupee hit a 18-month high of 65.05 against the dollar, tracking gains in Asian currencies after US President Donald Trump's failure to pass a healthcare reform bill raised concerns about the chances of a US fiscal stimulus. Traders said that the Reserve Bank of India stepped in to cap broader gains in the rupee. Dealers said increased selling of the dollar by exporters and banks also fuelled the rupee's gains.

Rupee also gained from strong $6.1-billion foreign investment into debt and equities this month. The rupee has gained 2.5 per cent so far this month against the dollar, extending its surge to 4.4 per cent so far this year. The gains in the rupee was also spurred by strong dollar inflows helped spark a rally in bond markets, sending the benchmark 10-year bond yield down as much as 12 basis points to 6.71 per cent, the lowest since February 8 when the central bank unexpectedly changed its monetary policy stance to "neutral" from "accommodative."

At 2.15 pm, the rupee was trading at 65.08 against the dollar.

Meanwhile, Indian stock markets were lower today as software services exporters and drug makers were hit by worries about the impact of a stronger rupee. The Sensex and Nifty were down around 0.50 per cent in afternoon trade. "Both global and domestic factors are riding the market today," said Vinod Nair, head of research at Geojit Financial Services.
 

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