Sharp Appreciation: On Friday, the Indian rupee appreciated sharply, reaching a two-month high against the US dollar.

• Intraday High: The local currency rose to an intraday high of 83.03 per dollar, strengthening by 25 paise or 0.30%.
• End of Session: The rupee settled at 83.10 per dollar, up 18 paise or 0.22%, marking its strongest level since March 19.
• Previous Day: On Wednesday, the rupee had settled at 83.28 against the dollar.
• Market Closure: Foreign exchange and bond markets were closed on Thursday for Buddha Purnima.

Factors Driving the Rupee’s Strength

• Economic Developments: Jateen Trivedi, VP Research Analyst – Commodity and Currency at LKP Securities, noted the rupee’s resilience due to significant economic developments in India.
• Foreign Inflows: Substantial fund inflows into the capital markets contributed to the rupee’s strength.
• Trading Range: Trivedi mentioned an expected trading range for the rupee between 82.90 and 83.35.
• Dollar Sales: A dealer at a state-owned bank observed private banks actively selling dollars during the day.

RBI Intervention:

• Market Intervention: The Reserve Bank of India intervened in the foreign exchange market by purchasing dollars.
• Curbing Volatility: The RBI aims to curb market volatility, especially with upcoming election results.

Bond Market Movements

• Slight Uptick in Yields: Government bond yields saw a slight increase as traders wound up positions ahead of the weekend.
• 10-Year Bond Yield: The yield on the benchmark 10-year government bond settled at 7.00%, up from 6.99% on Wednesday.

Positive Sentiment: The Indian rupee’s performance reflects positive sentiment driven by foreign investments and robust economic indicators.

RBI’s Role: The RBI’s intervention underscores its efforts to manage market volatility.

Future Trends: Investors and market participants will closely monitor currency and bond market trends in the coming weeks amid both domestic and global developments.