Indian Rupee Posts Best Weekly Performance Amid Dollar Inflows and Rate Hike Expectations

The Indian rupee ended the week on an unchanged note but posted its best weekly performance in recent times, thanks to strong dollar inflows into the central bank's special schemes. The USDINR trading range for the day was 94.36-94.68. India's services growth picked up in August, but it stayed near a four-year low, according to the PMI.

The European Central Bank's September 10 meeting is set to be closely watched by investors, with markets fully pricing in a 25-basis-point rate hike to 2.5%. Germany's factory orders rose 2.5% in July, exceeding market expectations of a 0.3% gain.

The Japanese yen dropped on profit booking after being supported amid dollar weakness following the Fed's Waller comments. The Bank of Japan is expected to deliver a quarter-point rate hike this month and another increase in December.