By Anil Varma April 30 (Bloomberg) -- India’s rupee was headed for a fourth monthly gain, the longest winning streak in three years, on optimism overseas investors will boost holdings of local assets as the improving economy lifts company earnings. Foreign investment in the nation’s bonds and equities reached record highs this week, exchange data show. Nine companies included in the benchmark Sensitive Index of local shares have posted earnings for the last quarter that met or exceeded the projections of analysts surveyed by Bloomberg, while only four have fallen short. The benchmark, known as the Sensex, has climbed 55 percent in the past year and on April 7 had its highest close in more than two years. “The rupee is showing a positive bias, taking a cue from the trend in equities,” said Roy Paul, a Mumbai-based deputy general manager at Federal Bank Ltd. “Earnings are showing an improving trend overall and that increases the chances of fresh capital flows coming in.” The rupee traded at 44.45 per dollar as of 10:31 a.m. in Mumbai, 0.1 percent stronger than yesterday’s close of 44.51 and 1.1 percent higher than it was at the end of March, according to data compiled by Bloomberg. The currency reached 44.165 on April 15, the strongest level since September 2008. Offshore forward contracts signaled traders pared bets for the rupee’s weakness in the coming months. They indicate the rupee will trade at 44.50 to the dollar in a month, compared with yesterday’s expectations for 44.58. Forwards are agreements in which assets are bought and sold at current prices for future delivery. Non-deliverable contracts are settled in dollars rather than the local currency. Foreign holdings of India’s stocks and bonds reached all- time highs of $79.1 billion and $13.1 billion, respectively, on April 27, according to data from the Securities and Exchange Board of India. The $1.2 trillion South Asian economy will grow at least 8 percent in the financial year that started April 1, compared with an estimated 7.2 percent in the previous 12 months, the central bank said April 20. --Editors: James Regan, Ven Ram To contact the reporter on this story: Anil Varma in Mumbai at avarma3@bloomberg.net To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net.

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