Indian rupee at 1-1/2-month highs on share gains, weak dollar

Traders expect the central bank to step in and buy dollars to prevent further sharp gains in the rupee

  
An India Rupee note is seen in this illustration photo June 1, 2017.

An India Rupee note is seen in this illustration photo June 1, 2017.

REUTERS/Thomas White

MUMBAI - The Indian rupee rose for a third straight session on Tuesday, strengthening above the psychological 73 per dollar level for the first time since end-March, tracking sharp gains in the local share market and a broadly weaker U.S. dollar.

The partially convertible rupee was trading at 72.98/99 per dollar, as of 0845 GMT, after touching 72.9650, its highest since March 30 and stronger than its close of 73.21 on Monday.

The dollar sank to a six-year trough against the Canadian currency and teetered near multi-month lows versus European currencies as Treasury yields stalled amid renewed expectations the United States will not hike interest rates anytime soon.

On the domestic front, the broader Nifty share index was up 1.3%, after rising to a two-month high, while the BSE share index was 1.4% higher, led by gains in financial and metal stocks with fresh COVID-19 cases staying below the 300,000 mark for a second straight day. .BO

Traders, however, expect the central bank to step in and buy dollars to prevent further sharp gains in the rupee.

(Reporting by Swati Bhat; Editing by Subhranshu Sahu) ((swati.bhat@thomsonreuters.com; twitter.com/swatibhat22; +91-22-68414381; Reuters Messaging: swati.bhat.thomsonreuters.com@reuters.net))

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