Rupee opens strong at 64.72/$, up 60 paise on Moody’s rating upgrade on India

The Indian rupee rose in the early trade on Friday on the back of Moody’s rating upgrade for Indian sovereign bonds.

The rupee has gained 60 paise at 64.72 per dollar versus previous close 65.32.

This is the biggest gain for rupee in four years against previous close. However, 6.79%, 2027 bond opens at Rs 99, which is the highest since November 10.

Moody’s Investor Services has lifted India’s sovereign rating to Baa2 from Baa3.

It upgraded the Government of India’s local and foreign currency issuer ratings to Baa2 from Baa3 and changed the outlook on the rating to stable from positive, the rating agency said in a note on Friday.

According to Jimeet Modi, Founder & CEO, Samco Securities said, “The upgrade comes as a pleasant positive surprise. This should lead to some respite for the bond markets and should also strengthen the rupee in the short term.”

“Over the long term, it’s a great advantage since it leads to an overall reduction in the cost of funds and interest savings for the government,” he added.

The dollar steadied after rising overnight against a basket of major currencies. The greenback however is mildly lower against the yen.