Aug. 30 (Bloomberg) -- India’s rupee completed its worst month since May 2010 as slowing economic growth spurred sales of the nation’s assets by foreign investors.
Asia’s third-largest economy expanded 7.7 percent last quarter from a year earlier, the smallest gain since 2009, a government report showed today. Overseas funds cut holdings of Indian shares by $2.3 billion this month through Aug. 29, the most since October 2008. The rupee also dropped on speculation oil importers bought dollars to pay month-end bills. Local financial markets are shut tomorrow and Sept. 1 for holidays.
“The performance of stocks has largely been the driver for the rupee,” said Vikas Babu, a currency trader at state-owned Andhra Bank in Mumbai. “Month-end oil demand also pressured the rupee.”
The rupee fell 4.1 percent this month to 46.09 per dollar as of the 5 p.m. close in Mumbai, the worst performance among Asia’s 10 most-traded currencies, according to data compiled by Bloomberg. It declined 0.1 percent today.
Offshore forwards indicate the Indian currency will trade at 46.45 to the dollar in three months, compared with expectations of 46.48 yesterday. Forwards are agreements to buy or sell assets at a set price and date. Non-deliverable contracts are settled in dollars.
--Editors: Anil Varma, Sam Nagarajan
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