India’s rupee was headed for a weekly gain on optimism the nation will attract more capital as limits on inward investment in government debt and the insurance business are relaxed.
The Reserve Bank of India this week increased the cap for foreign institutional investors by $5 billion and said additional purchases must be in notes maturing in at least three years.
Finance Minister Arun Jaitley said yesterday the cabinet approved a budget proposal of allowing 49 percent foreign direct investment in the insurance industry.
“The decisions to raise the FII debt limit and taking the process of FDI insurance forward are clearly positive for the rupee,” said Gaurav Sharma, a senior currency analyst at Religare Commodities Ltd. in Noida, outside New Delhi.
“There are inflows happening but the month-end dollar demand from oil importers is limiting rupee gains.”
The currency rose 0.2 percent this week to 60.155 per dollar as of 9:35 a.m. in Mumbai, according to prices from local banks compiled by Bloomberg. It fell 0.1 percent today.
One-month implied volatility, a measure of expected moves in the exchange rate used to price options, rose three basis points, or 0.03 percentage point, to 5.85 percent, according to data compiled by Bloomberg. It dropped 67 basis points from a week ago.
Three-month offshore non-deliverable forwards on the rupee fell 0.2 percent today to 60.86 per dollar, according to data compiled by Bloomberg.
Forwards are agreements to buy or sell assets at a set price and date. Non-deliverable contracts are settled in the greenback.
bloomberg.com
The Reserve Bank of India this week increased the cap for foreign institutional investors by $5 billion and said additional purchases must be in notes maturing in at least three years.
Finance Minister Arun Jaitley said yesterday the cabinet approved a budget proposal of allowing 49 percent foreign direct investment in the insurance industry.
“The decisions to raise the FII debt limit and taking the process of FDI insurance forward are clearly positive for the rupee,” said Gaurav Sharma, a senior currency analyst at Religare Commodities Ltd. in Noida, outside New Delhi.
“There are inflows happening but the month-end dollar demand from oil importers is limiting rupee gains.”
The currency rose 0.2 percent this week to 60.155 per dollar as of 9:35 a.m. in Mumbai, according to prices from local banks compiled by Bloomberg. It fell 0.1 percent today.
One-month implied volatility, a measure of expected moves in the exchange rate used to price options, rose three basis points, or 0.03 percentage point, to 5.85 percent, according to data compiled by Bloomberg. It dropped 67 basis points from a week ago.
Three-month offshore non-deliverable forwards on the rupee fell 0.2 percent today to 60.86 per dollar, according to data compiled by Bloomberg.
Forwards are agreements to buy or sell assets at a set price and date. Non-deliverable contracts are settled in the greenback.
bloomberg.com
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