Generally, both the Asian currencies – the Indian rupee and the Chinese yuan – tend to move in the same direction.
But the biggest 4-day rally for the Indian currency since January 2015 has widened its outperformance.
The Indian currency rose to its strongest level since October 2015 after the U.S. Federal Reserve’s decision met market expectations, adding to gains driven by Prime Minister Modi’s win in India’s largest state.
In fact, according to Bloomberg, the rupee is the best performing Asian currency over the last one month, while its Chinese counterpart is the top loser. The rupee has appreciated by 2.6 percent in a month, while the yuan has weakened (depreciated) by 0.5 percent.
The relative performance of the two currencies is important from the trade perspective.