USD/INR forecast: Rupee outlook as Indian bond yields jump

The USD/INR exchange rate continued its recovery this year, moving from a low of 83.77 in May last year to the current 91. This recovery continued this week as Indian bond yields and business activity rose.  Indian bond yields and business activity are rising  The USD to INR exchange rate rose on Friday as India published encouraging macro data, which will likely continue improving in the coming months. Data released by HSBC showed that the manufacturing PMI rose from 55.4 in January to 57.5 in February, a sign that the manufacturing sector is improving. The report also showed that the services PMI rose to 58.4, while the composite figure rose to 59.3, its highest level in months. A PMI figure…