The Indian rupee, equities and bonds rallied on Thursday after the US Federal Reserve said it is in no hurry to raise interest rates.

The rupee, which fell to a more than 13-month low on Wednesday, strengthened against the dollar following stock market cues, even as a broad-based dollar rally dragged down other Asian currencies. The cabinet clearing the goods and services tax (GST) Bill on Wednesday also boosted sentiment.

At 2.01pm, the Indian rupee was trading at 63.25 a dollar, up 0.59% from its previous close of 63.62. The local currency had opened at 63.36 a dollar. India’s benchmark equity index, S&P BSE Sensex, was trading at 27,102.62 points, up 1.47%.

Asian currencies were trading mixed against the dollar. The South Korean won weakened 0.68%, Taiwan dollar fell 0.34%, China renminbi was down 0.30%, and Singapore dollar slipped 0.22%. However, the Indonesian rupiah rose 0.83%, Malaysian ringgit was up 0.46% and Japanese yen strengthened 0.10%.

The yield on India’s 10-year benchmark bond stood at 7.924% compared with its Friday’s close of 7.971%. Bond yields and prices move in opposite directions.

Since the beginning of this year, the rupee has weakened 2.3% against the dollar, while foreign institutional investors have bought $16.84 billion from local equity markets and $26.09 billion from the debt market.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 89.131, up 0.01% from its previous close of 89.13.

The cabinet cleared the Bill to ease implementation of GST that aims to unify India into a common market by replacing taxes imposed by states and the Centre. This clears the way for the introduction of the draft legislation in the winter session of parliament, where it needs two-thirds majority in both houses to be cleared.

Source:livemint.com