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Rupee rises on likely dollar inflows, gains in Asian peers

A man counts Indian currency notes inside a shop in Mumbai

By Nimesh Vora

MUMBAI (Reuters) - The Indian rupee rose against the U.S. currency on Wednesday, helped by likely dollar inflows and gains in most major Asian peers.

The rupee last traded at 81.59 per U.S. dollar, compared with 81.72 in the previous session. It was a choppy session, with the local currency trading in a range of 81.50 to 81.76.

Rupee bulls can take a lot of positives from today's session - the rupee managed to hold above the 81.80 levels and it arrested the downside momentum, a trader at a Mumbai-based bank said.

There was talk of dollar inflows related to Adani Enterprises and once again, there was good demand from importers, he added.

Adani Enterprises' follow-on public offering (FPO) opens on Friday.

A tussle between buyers and sellers is likely to continue with inflows pertaining to Adani FPO on one side and the Reserve Bank of India's intervention on the other side, said Amit Pabari, managing director at CR Forex.

The RBI likely bought dollars on Monday when the rupee rose above the 81 level, according to traders.

The offshore Chinese yuan rose to 6.7750 to the dollar and the Korean won advanced, helped by a fall in Treasury yields. The two-year U.S. yield dropped to near 4.14%.

U.S. bonds have rallied this year on bets that softening inflation and growth concerns will force the Federal Reserve to cut interest rates later this year. A 25 basis points rate hike next week by the U.S. central bank has been priced in.

Meanwhile, Indian equities suffered their biggest fall in over a month and futures pointed to a weaker opening for U.S. shares. Oil prices inched up after Tuesday's more than 2% fall.

(Reporting by Nimesh Vora; Editing by Shinjini Ganguli)