Rupee Near One-Week High on Speculation Exporters Sold Dollars

India’s rupee ended within 0.4 percent of a one-week high after fund repatriation by exporters and companies that have borrowed abroad boosted foreign-exchange inflows.

Local firms including Reliance Industries Ltd., State Bank of India and Oil India Ltd. raised a combined $3.2 billion in overseas loans and bond sales this month, according to data compiled by Bloomberg.

“There are inward remittances,” said Paresh Nayar, head of currency and money markets in Mumbai at FirstRand Ltd., adding such inflows boosted the rupee.

The currency was little changed at 60.6475 per dollar in Mumbai, according to prices from local banks compiled by Bloomberg. It advanced as far as 60.4350 earlier, the highest level since April 21.

The rupee slipped from its one-week high, reversing earlier gains, on speculation importers increased dollar purchases to meet month-end payments.

“There is dollar demand from oil importers,” said Vikas Babu, a Mumbai-based currency trader at Andhra Bank. “Traders are unlikely to take large bets ahead of the Fed meeting.”

The MSCI Asia Pacific Index of shares dropped 0.5 percent before a Federal Reserve meeting on April 30, where the U.S. central bank will probably reduce its monthly bond purchases by $10 billion to $45 billion, according to a Bloomberg Survey.

Global funds added an average $69 million a day to holdings of local equities this month, compared with $189 million in March, according to exchange data. The rupee swung between gains of 0.3 percent and losses of 0.2 percent today.

One-month implied volatility in the rupee, a gauge of expected moves in the exchange rate used to price options, rose 12 basis points, or 0.12 percentage point, to 12.2325 percent.

Three-month offshore non-deliverable forwards advanced 0.3 percent to 61.78 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.

To contact the reporter on this story: Divya Patil in Mumbai at dpatil7@bloomberg.net

To contact the editors responsible for this story: Amit Prakash at aprakash1@bloomberg.net Sam Nagarajan, Thomas Kutty Abraham

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