USD/INR down on large inflows, but RBI likely stepped in at 47.02 to support pair after pair fell from 47.12, four dealers tell Dow Jones Newswires; pair at 47.05 vs 47.21 last close. “The central bank is believed to have been buying dollars in the last hour below 47.10,” says dealer with foreign bank. “The sudden drop in the pair from what was a narrow range since morning seems to be have come from a one-off flow,” says a private bank dealer, who tips size of flow at around $300 million. “The one-off flow probably comes from a foreign direct investment or private placement related inflow in the equity market, and seems to be coming from three large foreign banks,” says another private bank dealer, tipping a large British bank active in Asia, two large U.S. banks as likely seller.

Debt from companies with some of the lowest credit ratings had its best month ever last month, in yet another sign that sentiment is continuing to improve, even on some of the most stressed assets.

The leveraged loan market has staged a strong rally as consensus that a recovery is just around the corner becomes more entrenched, prompting investors to look further and further down the ratings spectrum in a bid to boost returns.

Continue reading →