Due to dollar sales by both domestic and international institutions, the Indian rupee closed the day stronger on Wednesday, reaching its highest level in more than two weeks. The rupee closed at 83.0425 against the US dollar, down from 83.1050 the previous day. The local currency saw its biggest monthly growth since June 2023 in January, rising by 0.2%.
Other Asian currencies had monthly declines ranging from 0.8% to 3% for the rupee. According to a foreign exchange trader at a private bank, the rupee benefited from dollar sales from major foreign banks in the second part of Wednesday’s trading session. But the trader said that bids on the dollar-rupee pair limited gains as it rose over the 83.05 mark.
At 103.49, the dollar index was essentially steady but seemed to be headed for a monthly rise of just over 2%.Despite a comeback in dollar strength in January, the rupee managed to hold its footing since the U.S. reduced its aggressive wagers on rate cuts, which placed pressure on its Asian competitors. Although the rupee reached its best level since September earlier in the month, 82.77, some of those gains were offset by equity-related outflows and a higher dollar.
