Indian Rupee: Likely to accrue mild gains as dollar weakens overseas

The Indian rupee could accrue mild gains tracking weakness in dollar overseas although cautious investors amid geo-political uncertainty are likely to dent sentiments. Asian markets were mostly lower this morning as trade tensions simmered and data showed Chinese manufacturing activity contracted for a second consecutive month in May. Meanwhile, for India, official data showed the Indian economy grew at a better-than-expected rate of 7.4 percent in Q4 of FY 2024-25. The first and second advance estimates, which were based on limited data, had projected 6.4 percent and 6.5 percent, respectively. Provisional estimates now peg India's GDP growth at 6.5 percent for 2024-25. Also, India's foreign exchange reserves increased by $6.992 billion, reaching $692.721 billion for the week ended May 23, according to the RBI's data. On Friday, INR pared its initial gains to settle 8 paise lower at 85.56 against the US dollar. The benchmark 30-share BSE Sensex dipped 182.01 points, or 0.22 percent, to 81,451.01 while the broader NSE Nifty index ended down 82.90 points, or 0.33 percent, at 24,750.70.

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