The euro rose against the yen and the dollar after Ukrainian President Petro Poroshenko disclosed that he had reached a deal with his Russian peer Vladimir Putin for a permanent cease-fire, causing investors to buy European assets in droves.
The euro rose 0.1 percent to trade at $1.3144 as of 9:29 a.m. London time, and rose 0.1 percent to 138.11 yen. The Japan’s currency stood at 105.08 yen per dollar after rising to 105.31, its lowest level since January 10.
The India’s rupee saw its volatility touch its lowest level in one month after global assets purchased more local assets as economic recovery appears to be gaining momentum. Foreign investors bought nearly $10 billion worth of Indian stocks and bonds in the third quarter, according to exchange data.
India’s gross domestic product rose 5.7 percent in the second quarter from a year ago, its fastest advance since the first three months of 2012. Another report on Sept. 1 showed that current-account shortfall stood at $7.8 billion, the most in a year.
“Inflows have been impressive on the back of favorable economic data and that’s supporting the rupee,” Anish Vyas, a currency analyst at Angel Broking Ltd in Mumbai, told Bloomberg News. “At the same time, the higher current-account deficit will cap sharp rupee gains.”
The rupee’s three-month implied volatility, which measures the projected moves in the exchange rate used to set prices to options, plunged 0.04 percentage points, or four basis points, to 7.03 percent at 9:37 am in Mumbai. This was the weakest level since August 1. The rupee advanced 0.1 percent to trade at 60.6250 per dollar in the spot market, ending a four-day losing streak.To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.
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