Mumbai: The Indian rupee strengthened on Tuesday recovering from two week lows hit in the previous session as a higher start to the domestic sharemarket and stronger regional peers boosted sentiment.
At 9:15am, the partially convertible rupee was at Rs44.58/59 per dollar, stronger than its Monday’s close of Rs44.73/74, when it hit Rs44.7450 during trade, its weakest since 5 April, according to Thomson Reuters data.
Most Asian currencies were stronger compared to the dollar.
Indian shares climbed 0.4% early on Tuesday, supported by firmer Asian markets. [.BO] Dealers said they would closely watch the RBI’s monetary policy statement for 11:15pm, for directin.
The RBI, which until recently had focused monetary policy largely on encouraging economic recovery, said on Monday the weight of policy balance may have to shift to containing high inflation.
A Reuters survey showed most economists expect an increase in both the repo and reverse repo rates. Among those expecting a rise, roughly two-thirds predicted a 25-basis-point increases and one-third foresaw 50-basis-point hikes.
The index of the dollar against six major currencies was little changed and would be watched for direction, dealers said.