Re rises most in a week, courtesy US jobs data

The rupee rose the most in more than a week after US jobs data beat economists’ forecasts in July, helping boost sentiment for emerging-market assets.

Employment in the world’s largest economy increased 163,000, exceeding the median estimate for a 100,000 gain in a Bloomberg News survey, a government report showed August 3. Appreciation in the rupee will be limited by concerns about India’s growth and inflation, according to Alpari Financial Services India Ltd.

“The sharp rise in the US non-farm payrolls number has boosted risk-on trade,” Pramit Brahmbhatt, Mumbai-based chief executive officer at the Indian unit of Alpari Financial Services, wrote in an e-mailed response to questions on Monday. “Weak domestic fundamentals shall limit the rupee’s gains.”

The currency rose 0.4 per cent to 55.52 per dollar, the biggest advance since July 26, according to data compiled by Bloomberg. It touched 55.24 earlier, the strongest level since July 30.

Bonds recover on good demand
Government securities (G-sec) recovered on good buying support from banks and companies. The 8.33 per cent G-sec maturing in 2026 climbed to Rs 99.52 from Rs 99.46 last Friday, while its yield inched down 8.39 per cent from 8.40 per cent. The 8.15 per cent G-sec maturing in 2022 surged to Rs 99.50 from 99.28, while its yield declined to 8.22 per cent from 8.26 per cent.

Call rates stable
Overnight call money rates closed stable as demand from borrowing banks matched supplies. The rate finished steady at eight per cent, it moved in a range of 8.05 per cent and 7.95 per cent.