The Indian rupee advanced today as inflation slowed to the lowest level in three years, leading to speculations that capital inflows into the country will increase and demand for the nation’s currency will grow.
The Wholesale Price Index was at 7.18 percent for December on an annual basis, slowing from the previous month’s 7.24 percent. That was the lowest level since 2009. Global funds continue to pour money into the country, giving hope that the economy will pick up. As for the negative influence, falling exports put pressure on the rupee as shipments contracted 1.9 percent last month from a year ago.
USD/INR fell from 54.7625 to 54.5000 as of 14:18 GMT today.
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