Indian rupee at highest in nearly 3 weeks, tracks broad dollar losses

MUMBAI (Reuters) - The Indian rupee strengthened to its highest in nearly three weeks on Friday, tracking broad losses in the dollar on easing concerns over the need for continued aggressive interest rate hikes by the U.S. Federal Reserve.

The partially convertible rupee was trading at 79.40/41 to the dollar by 0345 GMT, from Thursday's close of 79.7550. In early trade it rose to a high of 79.3925, its strongest since July 11.

The dollar languished near a six-week low against the yen amid a sharp retreat in Treasury yields after investors interpreted a shrinking U.S. economy as one more reason for the Federal Reserve to ease off the tightening pedal.

Most Asian currencies also rose against the dollar. [EMRG/FRX]

(Reporting by Swati Bhat; Editing by Clarence Fernandez)