Indian rupee breaks six-day winning streak on state banks' dollar bids

The Indian rupee ended a six-session advance on Monday, closing at 93.9275 per dollar compared with 93.9050 previously, Business Recorder reported. It had earlier reached 93.69, its strongest level in six months, but state-run banks’ dollar buying outweighed the currency’s recent gains amid thin trading.

Traders suggested the banks could have been purchasing dollars for the central bank, whose recent steps have eased pressure from a mismatch between foreign-currency supply and demand. Lower crude prices and renewed foreign investment in equities offered some support, while the Indian foreign exchange market is scheduled to close on Tuesday for a local holiday.

The report also cited expectations that the Reserve Bank of India could use sustained inflows to rebuild its reserves rather than encourage a sharp rise in the rupee. Meanwhile, a stronger-than-expected US jobs report lifted the dollar and US 10-year yields; US inflation data due Tuesday could further shape expectations for Federal Reserve policy.