Rupee Rebounds on Optimism Yield Advantage Will Attract Inflows
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India’s rupee rose, erasing earlier losses, on speculation the yield advantage on local assets will attract global capital as advanced nations keep interest rates low to revive economic growth.
The European Central Bank will keep its benchmark rate at a record low today, a Bloomberg News survey showed. Euro-based investors will earn 10.9 percent including interest, the most in Asia, by holding rupees until the end of this year, based on currency forecasts and deposit rates compiled by Bloomberg. Ten-year government bonds pay 7.86 percent in India, compared with 1.92 percent in the U.S. and 1.44 percent in Germany.