Indian Rupee Rises To 2-day High On Upbeat India's PMI Data

(RTTNews) - The Indian rupee strengthened against the U.S. dollar in the European session on Thursday, after India's private sector activity expanded at the fastest pace on record amid sharp growth in new orders.

Data from S&P Global showed that the HSBC flash composite output index rose to 65.2 in August from 61.1 in July.

Moreover, India's private sector economy posted its sharpest expansion since survey data were first collected in December 2005.

Manufacturers registered their strongest growth in activity since January 2008, as the Manufacturing PMI rose to 59.8 in August from 59.1 in July.

The services Purchasing Managers' Index climbed to 65.6 in July from 60.5 in the previous month.

The introduction of Goods and Services Tax (GST) reforms by Indian Prime Minister Narendra Modi on Independence Day has boosted market confidence that the Reserve Bank of India (RBI) will be hesitant to take an aggressive monetary easing policy, which has caused the USD/INR pair to decline.

India's Prime Minister Modi declared on August 15 that the government would implement GST 2.O, which would lower goods taxes in an effort to increase consumption.

Traders await the Federal Reserve (Fed) Chair Jerome Powell's remarks at the Jackson Hole (JH) Symposium on Friday, as the investors prepare for a wider sideways trend in the USD/INR pair.

Against the U.S. dollar, the rupee rose to a 2-day high of 86.923 from an early low of 87.070.

If the rupee extends its uptrend, it is likely to find resistance around the 86.00 region.

Looking ahead, Canada PPI and raw material prices for July, U.S. weekly jobless claims data, U.S. Philadelphia Fed manufacturing index for August, Eurozone flash consumer confidence for August, U.S. S&P Global flash composite PMI for August, U.S. Philly Fed business conditions for August, U.S. existing home sales for July and U.S. Consumer Board's leading index for July are slated for release in the New York session.