Bond inflows and improved sentiment lift Indian rupee 0.8% this week despite Fed-driven dollar rise

The Indian rupee has climbed 0.8% this week to a six-week high, supported by stronger inflows into Indian bonds and a slowdown in foreign equity outflows. Importers and exporters have also shifted toward more two-way hedging activity. The move comes as India takes steps to attract dollar inflows and crude oil prices plunge after the U.S.-Iran peace deal, even as the dollar index rises 1% this week to 100.92 on the Fed’s hawkish signals.