The Indian rupee traded at its highest since August 19 and is on track to extend its winning streak to a sixth session on Thursday. The partially convertible rupee traded at 62.92 per dollar, up 0.7 per cent as against Wednesday's close of 63.38.
The rupee's sharp recovery has been aided by the easing of geopolitical concerns, with an attack on Syria appearing less imminent, and the announcement of a series of steps to attract inflows by the new central bank Governor, Raghuram Rajan.
The rupee has now recovered 5.8 per cent over the last five sessions, its longest winning streak in a year, since Raghuram Rajan took over as the central bank chief on September 4 and unveiled a raft of steps including allowing banks to borrow more overseas and offering a concessional swap facility to banks to raise deposits from overseas Indians. (Read: Why Raghuram Rajan says analysts are like Indian cricket fans)
Thursday's gains came on the back of dollar weakness, which remained under pressure on growing expectations that the U.S. Federal Reserve's impending stimulus reduction might be smaller than some had believed.
The Federal Open Market Committee meets next Tuesday and Wednesday. While it is still widely expected to begin scaling back its $85 billion monthly asset-buying programme, Friday's disappointing jobs data prompted many to believe the reduction will be more modest than some had previously expected.
A Reuters survey earlier this week showed most economists see the U.S. central bank trimming its asset purchases by about $10 billion.
Avinnash Gorakssakar, head (research) at miintdirect.com told NDTV that for now the scare that the rupee may hit 71-72 per dollar might not materialise.
"August trade data has given hopes that exports are picking up. That will help in curtailing the current account deficit and will be positive for the rupee," he added.
Foreign institutional investors (FIIs) have resumed buying shares in the spot markets, which has boosted sentiments.
However, stock markets traded lower today after five days of rally led to an over 10 per cent gains in the benchmark indices.
The BSE Sensex was down 0.5 per cent or around 100 points at 19,899, while the Nifty traded 26 points lower at 5,887. The rupee traded off the day's high at 63.16 as of 09.30 a.m.
Source:- profit.ndtv.com
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