MUMBAI, April 24 (Reuters) - The Indian rupee gained on Wednesday, aided by a recovery in risk appetite that helped lift Asian currencies, while dollar-rupee forward premiums also ticked higher.
The rupee was at 83.27 against the U.S. dollar as of 10:15 a.m. IST, its strongest level since April 10 and higher than its close of 83.3425 in the previous session.
The dollar index declined on Tuesday and was last quoted at 105.6, while the Korean won and Indonesian rupiah rose by 0.4% each to lead the gains among the rupee's Asian peers.
U.S. PMI data on Tuesday showed that business activity cooled to a four-month low in April due to weaker demand, which pulled the dollar down by nearly 0.4%.
The rupee is likely to head higher after risk assets saw a smart recovery in the past two days and is expected to hover in a range of 83.20 to 83.50 in the near term, said Dilip Parmar, a foreign exchange research analyst at HDFC Securities.
Meanwhile, dollar-rupee forward premiums ticked higher, with the 1-year implied yield up 2 basis points at 1.68%.
"Weak data from the U.S. typically spurs some paying interest but broadly, far forwards continue to be a receive on upticks," a foreign exchange trader at a state-run bank said.
Investors now await the release of U.S. GDP data on Thursday and personal consumption expenditure (PCE) inflation data on Friday for cues on the potential timeline of rate cuts by the U.S. Federal Reserve.
U.S. GDP growth is expected to have slowed to 2.4% in the January-March quarter, from 3.4% in the previous quarter, while core PCE inflation likely held steady at 0.3% month-on-month in March, according to Reuters' polls. (Reporting by Jaspreet Kalra; Editing by Savio D'Souza)
