Rupee has climbed 6% against the dollar this year as Asia’s third-largest economy lured more than $14 billion into its bonds and equity markets. Photo: AFPSingapore/Mumbai: Reserve Bank of India’s (RBI) apparent tolerance of rupee gains is burnishing the appeal of Asia’s best carry-trade currency. That’s all spurred Aviva investors to add to its rupee positions, and Bank of America Merrill Lynch is recommending buying the currency. The rupee is delivering the best carry-trade returns in emerging markets this year, toppling the Indonesian rupiah, which was 2016’s king in Asia. Borrowing in US currency to purchase rupee assets has earned 7.9% this year, the highest carry return in Asia, data compiled by Bloomberg show.

Source: Mint May 16, 2017 02:48 UTC