Count Goldman Sachs Asset Management and William Blair Investment Management as buyers of the rupee as it tries to recover from record lows set last summer (it's up about 10% since). It looks "cheap" relative to India's improving external finances, says Goldman, taking a "small long" position.
William Blair has poured 20% of its foreign-exchange holdings into the rupee - enticed by the higher yield and inexpensive valuation, says its Brian Singer. A dollar-based investor will 9% interest owning the rupee this year, the 2nd-largest return in Asia, according to Bloomberg.
"Current-account numbers have been the key driver because it’s a very transparent measure of whether the policy prescriptions are having an impact," says Goldman's Philip Moffitt, “If you can find something that’s relatively cheap and the fundamentals appear to be improving, it’s usually a good mix.”