AMN
The Indian rupee continued its upward momentum for a sixth straight trading session on Monday, appreciating by 12 paise to close at 95.31 against the US dollar (provisional). The domestic currency was supported by a sharp decline in international crude oil prices, a weaker US dollar, sustained foreign institutional investor (FII) inflows, and positive sentiment in domestic equity markets.
The rupee drew strength after global oil prices retreated significantly following US President Donald Trump’s decision to postpone planned military strikes on Iran, raising hopes for a diplomatic resolution to tensions in the Middle East. The easing geopolitical concerns reduced pressure on crude prices, benefiting oil-importing nations such as India.
Market sentiment also improved as the US dollar weakened in global markets. The dollar index slipped after coordinated intervention by the United States and Japan to support the Japanese yen, making emerging market currencies, including the rupee, more attractive.
Robust foreign capital inflows into Indian equities and continued gains in domestic stock markets further boosted the local currency. Investors responded positively to the softer dollar environment and the decline in energy prices, which strengthened confidence across financial markets.
In the currency market, the rupee opened at 95.15 per US dollar in the interbank foreign exchange market. It traded within a narrow range of 95.11 to 95.34 during the session before settling at 95.31 (provisional), marking a gain of 12 paise over its previous close and hovering near its strongest level in nearly four weeks.
Meanwhile, Brent crude futures dropped nearly 5 per cent to around 83 dollars a barrel after President Trump indicated that a fresh military strike on Iran had been put on hold and suggested that a negotiated agreement was within reach. The sharp decline in oil prices eased concerns over India’s import bill and inflation outlook, providing additional support to the rupee.
Overall, the combination of lower crude prices, a softer US dollar, renewed foreign investment, and firm domestic equities helped the Indian currency extend its recent winning streak.