The Indian rupee appreciated for the second consecutive day and gained over 8 paise against the US dollar on Monday. The domestic currency opened unchanged today, very quickly edged higher and extended the gains to hit a day’s high of 64.34. The rupee rose 8 paise to close at 64.37 apiece US dollar at the interbank foreign exchange market today. The Reserve Bank of India fixed the reference rate of the rupee at 64.3616 against the US dollar on Monday. The Indian rupee moved up 23 paise against the US dollar in just 2 days as Narendra Modi led BJP is most likely to conquer Gujarat for the fifth consecutive time in the state elections. Way back in March 2017, the rupee appreciated as much as 79 paise in a single day to close at a 16-month high against the US dollar after Bharatiya Janata Party’s landslide victory in Uttar Pradesh state elections.

Finance Minister Arun Jaitley is all set to present the fifth and last full-year Budget of the NDA government before 2019 general elections on 1 February 2018 which is least likely to be populist. The Prime Minister Economic Advisory Council (PMEAC) member Rathin Roy said that the government will present a responsible budget. It is being highly speculated that the Narendra Modi government in its last budget may announce a populist measure to score in the upcoming general elections, but PMEAC member differs: I would not think any populism is permissible. I think the government will present a responsible budget, which will reflect its expenditure quality and commitments.

Meanwhile, Indian stock markets continue to rally for the third consecutive day and ended higher inching towards record highs on Monday ahead of the second phase of Gujarat state elections due later on 14 December. BSE Sensex gained 205.49 points or 0.62% and NSE Nifty added 56.6 points or 0.55% to settle at 10,322.25. A sharp uptick in the shares of Tata Consultancy Services, ITC, HDFC, and State Bank of India contributed heavily to the upsurge of key equity indices Sensex and Nifty. During the day, benchmark Sensex rose as much as 285.67 points to hit the day’s high at 33,535.97 whereas broader Nifty 50 index jumped 63.55 points to mark the day’s high at 10,329.2. Investors seemed to have digested the macroeconomic data packed weeks till the Reserve Bank of India’s monetary policy which came in last week only. Now, the market participants are keenly awaiting the outcome of Gujarat state elections, which is likely to gauge stock market direction ahead.