Rupee began the week in green, gaining 40 paise to 95.20 against the US dollar in early Monday trade. The currency was driven by optimism in global markets over hopes of a potential peace deal between the United States and Iran.
In the interbank foreign exchange market, the rupee opened at 95.36 against the US dollar before strengthening to 95.20 in early deals, marking a gain of 40 paise from its previous close.
On Friday, the domestic currency had already gained momentum, rising 75 paise to settle at 95.60 against the US dollar. The recovery comes after rupee had fallen 6% since the Middle East crisis began on February 28, when US and Israel launched joint strikes on Iran.
“The trade deal will be beneficial to both the US and India,” said Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP. He added that as Monday is a US holiday, dollar cash demand is expected to remain lower, although month-end demand could emerge, while the Reserve Bank of India (RBI) is likely to remain watchful of dollar movements.
The currency strengthened after signs that the US and Iran have “largely negotiated” a peace pact aimed at ending the nearly three-month-long conflict.
However, uncertainty persists at the leadership level.
US President Donald Trump told negotiators “not to rush into a deal” and that “both sides must take their time and get it right”.
In parallel developments on the trade front, US Secretary of State Marco Rubio said the US and India are close to finalising an interim trade agreement, following progress in discussions with the US Trade Representative, who is expected to visit India soon.
Meanwhile, the dollar index, which measures the greenback against a basket of six currencies, was down 0.20% at 99.04.
In commodities, Brent crude, the global oil benchmark, declined 5.43% to $97.92 per barrel in futures trade.
Dalal Street also reflected the positive sentiments, with benchmark indices surging over 1% in early trade. BSE Sensex jumped 908.98 points to 76,317.85, while the Nifty rose 262.65 points to 23,977.70.
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Read MoreThe TOI Business Desk is a vigilant and dedicated team of journalists committed to delivering the latest and most relevant business news from around the world to readers of The Times of India. The primary focus of the TOI Business Desk is to keep a watchful eye on the global business landscape, covering a wide spectrum of industries, markets, economic trends, in-depth analysis, exclusive reports and breaking stories that impact businesses and economies. With a mission to provide valuable insights and updates, the desk ensures that TOI readers are well-informed about the ever-changing and dynamic world of commerce and can navigate the complexities of the business world.
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