India’s government and central bank took coordinated steps on Friday to spur foreign inflows, providing an immediate boost to the beleaguered currency. The challenge for policymakers will now be to sustain those flows in the face of economic threats beyond their control.
The double-barreled intervention by authorities was hailed by investors as significant enough to spur as much as $50 billion into Indian bonds and stocks this year and reverse an outflow that’s dragged the rupee to a record low. The currency and bonds rose on the news.
