Mumbai (Economy India): The Indian rupee appreciated by 21 paise in early trade on Monday, climbing to 90.73 against the US dollar, supported by a sharp fall in global crude oil prices and weakness in the American currency in overseas markets.
At the interbank foreign exchange market, the rupee opened at 90.76 per dollar and soon gained momentum to touch 90.73, registering a notable rise from its previous close. Forex traders attributed the early strength to easing oil prices and improved sentiment across emerging market currencies.
Crude Oil Decline Boosts Sentiment
A significant drop in global crude oil prices helped ease concerns over India’s rising import bill and inflationary pressures. As India imports a large portion of its crude oil requirement, lower prices tend to support the domestic currency by reducing dollar outflows.
Market participants said sustained softness in oil prices could provide near-term stability to the rupee, particularly at a time when global growth concerns remain elevated.
Dollar Weakens on Tariff Uncertainty
The US dollar weakened against major global currencies amid uncertainty surrounding potential tariff hikes proposed by Donald Trump. Reports suggesting that US import tariffs could be raised to 15 per cent triggered caution among investors, leading to a pullback in the dollar index.
A weaker greenback often supports emerging market currencies, including the rupee, as global investors seek higher-yielding assets.
Outlook Remains Cautious
Currency experts noted that while the rupee showed strength in early trade, volatility could persist during the session. Future movement will depend on:
- Trends in crude oil prices
- Direction of the US dollar index
- Foreign institutional investor (FII) flows
- Global geopolitical and trade developments
Markets are expected to remain cautious ahead of key global economic cues and policy signals from major central banks.
(Economy India)
