From shy of hitting 70, to now under 60.
By The American Bazaar Staff
NEW DELHI: The Indian rupee hit its highest point in 11 months at the end of trading on the Indian markets Monday, riding the nation’s collective high now that the BJP and Narendra Modi are at the helm of the Indian government.
The rupee currently sits at 58.56 against the dollar, the best it’s been since it was 58.53 against the dollar in June 18 of last year. Monday’s closing value capped a week of foreign investments flowing into India, which helped bolster the rupee, as Modi’s eventual ascension to becoming Prime Minister became increasingly evident.
The rupee has had a rough year up to this point, however, beginning a remarkable slide last summer from which it has not still fully recovered. India’s rupee started 2013 at just under 55 against the dollar, according to XE.com current charts, but began plummeting in value in May. Its lowest point came in late August, when the rupee came just shy of hitting 70 against the dollar.
Since then it’s been a slow and somewhat steady climb back to normalcy, as India has fought to re-establish confidence in its markets. Having now remained steadily under 60 so far this month, India is hoping that the rupee eventually settles in the low 50s, where it was at the end of 2012 and the first quarter or so of 2013.
Modi, who is seen as a pro-business leader, will likely continue to inspire confidence in the Indian economy. Additionally, the prospect of a more stable government and promises of reformation in terms of corruption and other social issues plaguing will continue to drive up the value of the rupee, say analysts.
On Friday, India’s dollar reserves closed at a two-year apex of $313.83 billion, the highest its been since November of 2011. India’s BSE and NSE stock indexes both saw noticeable upticks on Monday, as well. Offshore non-deliverable one-month contracts were at 58.89 against the dollar, and the three month closed at 59.49.