UAE: Indian rupee soars against dirham, records highest single-day gain in 2 months

Forex traders say selling pressure in the greenback and retreating crude oil prices also gave the Indian currency a boost

By Web Desk

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Published: Thu 24 Aug 2023, 10:10 AM

Last updated: Thu 24 Aug 2023, 10:11 AM

The Indian rupee registered the highest single-day gain in nearly two months as it jumped by 25 paise to 82.47 against the US dollar (22.47 against UAE dirham) in early trade on Thursday.

A weakening dollar, foreign funds inflows, and positive equity markets are among the factors that have influenced the rate recently, say experts.

According to reports, the South Asian currency's sharp gain of 52 paise in the past two sessions was attributed to Reserve Bank of India's move to prevent banks from indulging in short-term trading in offshore currency markets.

[Editor's Note: For real-time forex rates, click the widget below or visit KT's dedicated Trading News pageb here.]

Forex traders said selling pressure in the greenback and retreating crude oil prices also boosted the Indian currency even as investors traded cautiously ahead of the Brics summit and US Federal Reserve Chair Jerome Powell's speech at Jackson Hole Symposium during August 24-26.

Buy bonds?

The selloff in the US Treasuries halted following disappointing data. US business activity approached the stagnation point in August, with growth at its weakest since February, with demand for new business in the vast service sector contracting.

"The data indicate both manufacturing and services are contracting. Leading indicators of future activity suggest weakness lies ahead," ANZ said in a note.

The weak Eurozone flash composite PMI data provided another reason for investors to buy bonds.

"In recent months, the PMI has painted a worsening picture of eurozone activity, and August data are no different." ING Bank said in a note.

The dollar index fell by the most in more than two weeks on Wednesday. Asian currencies were mostly higher, with the Korean won leading the way.

(ANI, Reuters)


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