India Bond Inflows Hit 15-Month High as US-Iran Deal Cools Oil, Lifts Rupee
Updated
Updated · Bloomberg · Jun 16
India Bond Inflows Hit 15-Month High as US-Iran Deal Cools Oil, Lifts Rupee
3 articles · Updated · Bloomberg · Jun 16
Summary
Foreign buying of India bonds climbed to a 15-month high after an interim US-Iran deal to reopen the Strait of Hormuz eased oil prices and improved sentiment toward Indian assets.
The rupee strengthened to 94.72 per dollar on Monday, testing its 50-day moving average after failing to break that level convincingly for more than a year.
Deutsche Bank named the rupee one of its four top currency picks, arguing RBI policies should support near-term inflows and longer-term structural demand; risk appetite is also returning to smaller stocks.
Monsoon risks still cloud the outlook: Finance Minister Nirmala Sitharaman said the government is preparing for weaker-than-normal rainfall, though food stocks are adequate to manage supply disruptions.
The Fed’s Wednesday meeting is the next key test, with economists expecting no rate change as officials assess how the Iran war’s oil-price shock feeds through the economy.