Indian rupee hits over 5-month high

NEW DELHI, Aug 27 (Reuters): Indian rupee led Asian currencies with a more than half per cent gain on Thursday, adding to this week's central bank-inspired appreciation against the dollar, while South Korean shares sank after Bank of Korea slashed its economic outlook for the year.

The rupee had surged 1.0 per cent on Monday as dealers reported a halt in central bank buying of the dollar, widely understood to be aimed at aiding the competitiveness of Indian exporters as the economy struggles with one of the world's worst coronavirus outbreaks.

Dealers said a large order, potentially squaring up ahead of a keenly-watched speech by US Federal Reserve chief Jerome Powell later later in the day, helped drive the rupee to 73.9 per dollar on Thursday, its highest level since March 17.

"It is a fix related selling probably by a large banker or corporate which has contributed to the sudden fall in USD/INR," said Anindya Banerjee, vice president at Kotak Securities.

"The undertone remains of a strong rupee due to a soft USD overseas and robust inflows into equity markets."