The Indian rupee opened stronger on Monday, supported by a weak US dollar and an easing in Brent crude oil prices following ceasefire talks between Israel and Iran-backed Hamas.
The rupee appreciated 6 paise to open at Rs 83.89 against the US dollar, according to Bloomberg data. The local currency closed at Rs 83.95 on Friday.
Oil prices continued their declining streak in the US-led efforts to secure a ceasefire in the conflict between Israel and Iran-backed Hamas in the Gaza Strip.
Israel initially voiced cautious optimism over the prospect of a pause in the fighting, but fresh disagreements are surfacing, according to a Bloomberg report. Furthermore, China's economic concerns had an impact on the market.
The West Texas Intermediate was below $77, while the Brent Crude was down 11% to $79.59 as of 9:11 a.m. The dollar index was down 0.20% at 102.25.
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The rupee hovered around Rs 83.95 against the US dollar, showing minimal fluctuation and narrowly steering clear of the critical Rs 84 mark, said Amit Pabari, managing director of CR Forex Advisors. "This stability is largely credited to timely interventions by the Reserve Bank of India."
The rupee is expected to remain within a range. In the near term, it is likely to trade between Rs 83.80 and Rs 84.05, with a slightly broader range of Rs 83.70–84.10 anticipated in the medium term, he said.
Exporters need to wait for Rs 83.96 to sell their near term dollar receivables, while importers can buy dollars at the current dip to hedge near term payables, said Anil Kumar Bhansali, head of Treasury and executive director of Finrex Treasury Advisors LLP.
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