RBI intervention, dollar flows push Indian rupee to two-month peak

Business Recorder reported that the Indian rupee climbed to a two-month high against the US dollar on Tuesday, helped by sizeable dollar sales from the central bank and dollar supply from overseas lenders tied to client flows. The currency closed at 94.9500 per dollar, 0.2% stronger than the prior session, and posted its third straight daily gain. It also closed above 95 per dollar, which had not happened in two months.

The gain came even as Asian currencies sold off amid a deepening global bond rout, with Japan's benchmark yield reaching 3%, a level not seen in three decades. Regional peers fell between 0.2% and 5.2%. US Treasuries also weakened, and the 10-year yield climbed to a peak last seen in January 2025 as traders increased wagers on a US rate increase this month due to inflation worries.

On Monday, Donald Trump warned of more strikes against Iran after a direct exchange of attacks, the first in a month, adding to regional tension. Brent crude traded 2% higher at $92.25 a barrel in Asian hours. Finrex's Anil Kumar Bhansali said higher oil and global yields capped the rupee's gains and expects it to stay between 94.75 and 95.25 in the near term. The central bank's forex forward book reached a record of close to $137 billion in July, drawing market attention to its currency intervention.