Rupee gains past 61 per dollar as inflation eases.

​Mumbai: The Indian rupee on Thursday opened higher on softer consumer price index (CPI)-based inflation data. The domestic currency opened at 61.02 per dollar and soon gained past the 61 level compared with its Wednesday’s close of 61.22.

At 9.13am, the rupee was trading at 60.97, up 0.42% from its previous close, while India’s benchmark Sensex was trading at 21,736.61 points on BSE, down 0.55%.

Most of the Asian currencies were also trading higher, providing support to the rupee. The Indonesian rupiah was up 0.53%, South Korean won rose 0.47%, Malaysian ringgit strengthened 0.26%, while Philippines peso was up 0.2%.

Retail inflation slowed for the third consecutive month to a two-year low of 8.1% in February. The rate is now closer to the target of 8% set for January 2015 by a Reserve Bank of India (RBI) committee.

Separately, government data showed that factory output grew by a meagre 0.1% in January after having contracted for three consecutive months, a clear indication that industrial recovery is still far off.

Since the beginning of this year, the rupee has gained 1.39%, while foreign institutional investors have bought $884.7 million from local equity markets.

The yield on India’s 10-year benchmark bond was trading at 8.712%, compared with its Wednesday’s close of 8.717%. Bond yields and prices move in opposite directions.
The dollar index, which measures the US currency’s strength against major currencies, was trading at 79.602, down 0.01% from its previous close of 79.608.

Source : livemint.com