Rupee ends nearly flat as traders remain glued to oil moves, RBI caps fall
The rupee had declined 0.2% to 96.1475 in early trading but trimmed losses to close nearly flat at 95.98 as Brent oil prices turned lower on the day, after touching a peak of nearly $108 per barrel.
The Indian rupee remained nearly unchanged on Tuesday as traders kept a close eye on oil movements, with the Reserve Bank of India (RBI) intervening to prevent further declines. The currency had slipped 0.2% to 96.1475 in early trading but closed near its opening level at 95.98 due to a fall in Brent oil prices. India's heavy reliance on imported crude oil, accounting for nearly 90% of its needs, makes the rupee particularly sensitive to oil price fluctuations.
State-run banks likely offloaded dollars early in the session to curb the rupee's downward momentum, and sentiment improved as oil prices eased. Traders expect the rupee to trade between 95.40-50 per dollar if oil prices fall below $100 per barrel, while it may stay closer to 96 if prices remain stable. Meanwhile, diplomatic efforts to end the war between the US and Iran were ongoing, with US and Iranian officials holding separate talks with mediators.
Meanwhile, tensions over oil prices and US Treasury yields have supported the dollar, which gained 0.3% to 101.5. Analysts at ING anticipate more volatility in the greenback as investors await key US economic data and Fed policymakers' statements.
Written by urgent.news from Hindu BusinessLine's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
