BLBG:India’s Rupee Strengthens as Greece Optimism Spurs Fund Inflows
India’s rupee strengthened for the first time in three days on speculation Greece is making progress in its efforts to secure more international aid, boosting demand for emerging-market assets.
Overseas funds boosted holdings of Indian shares by $227 million on Feb. 6, exchange data show. Greek Prime Minister Lucas Papademos will meet the heads of three political parties today to negotiate terms for a 130 billion-euro ($172 billion) rescue package. The nation’s government officials held “constructive” talks with private bondholders yesterday, according to a statement from the International Institute of Finance.
“This isn’t a full out risk-on rally yet,” said Vishnu Varathan, an economist at Mizuho Corporate Bank Ltd. in Singapore. “The markets are getting weary of the negotiations and seem to have priced in the fact that Greece will reach some sort of deal.”
The rupee advanced 0.1 percent to 49.15 per dollar in Mumbai, according to data compiled by Bloomberg.
Three-month onshore forwards traded at 50.16 a dollar, compared with 50.19 yesterday. Offshore non-deliverable forwards traded at 50.13 from 49.92. Forwards are agreements to buy or sell assets at a set price and date. Non-deliverable contracts are settled in dollars.
To contact the reporter on this story: Jeanette Rodrigues in Mumbai at jrodrigues26@bloomberg.net
To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net
