The currency is now up for a fourth successive session as global stocks have rallied on hope that rate cuts and stimulus packages will bolster the global economy
The Indian rupee gained further ground on Thursday, touching a new five-week peak, while the yield on the benchmark government bonds continued its recent slide after the Federal Reserve cut rates to nearly zero.
At 11:15 a.m., the partially convertible Indian rupee was at 47.33 per dollar as against yesterday's close of 47.65 per dollar. The rupee today touched a high of 47.28 - its strongest since November 10. Its low for the day so far is 47.43 after opening at 47.32.
The currency is now up for a fourth successive trading session as global stocks have rallied on hope that rate cuts and stimulus packages will bolster the global economy. The rupee is down nearly 7% from a record low of 50.6150 touched on Dec. 2. The currency’s 17% loss this year is still the biggest since 1991.
Meanwhile, the yield on the 8.24% note due in 2018 dropped 16 basis points to 5.64% and its lowest since June 2004. The price climbed Rs1.25 to Rs118.67. A basis point is 0.01 percentage point. The 10-year bond yield fell below 6% on Tuesday for the first time since September 2004.
Benchmark bond prices gained for a ninth day today, the longest winning streak in more than three months, on speculation that slowing inflation will give more head room to the Reserve Bank of India (RBI) to lower interest rates.
Government reports last week showed that industrial production fell for the first time since 1993 and the inflation rate dropped to a seven-month low.
