Mumbai: The Indian rupee is poised to open firmer on Wednesday, driven by lower oil prices and improved risk appetite amid hopes of a resumption of U.S.-Iran peace talks.
The rupee will open in the 93.14-93.18 range versus the U.S. dollar, having settled at 93.3750 on Monday. India’s financial markets were shut on Tuesday.
Brent crude for June delivery slipped to $94.40 a barrel in Asian trade, extending a 4.6% decline from the previous session, on expectations that peace talks between the United States and Iran could resume. The contract had surged to around $104 on Monday after negotiations collapsed over the weekend. [O/R]
Talks aimed at halting the conflict could restart in Pakistan over the next two days, U.S. President Donald Trump said on Tuesday, after the breakdown in negotiations prompted Washington to impose a blockade on Iranian ports.
The renewed diplomatic push has lifted optimism that the conflict could be resolved, potentially restoring disrupted crude oil and fuel flows.
Oil has witnessed a sizeable pullback, and the rupee “will respond”, a currency trader at a private sector bank said.
The rupee “has broadly settled” in a range near the 93 level, and “you can count on a range of 92.80-93.50 for the time being”, he added.
U.S. equities extended their advance on Tuesday after reclaiming pre‑war levels in the previous session. Asian shares tracked Wall Street higher, while Indian equities were set to jump more than 1% at the open.
“From a financial market perspective, it’s amazing how much has retracted in terms of the negative hit to risk sentiment post the Iran conflict,” MUFG Bank said in a note.
The bank said the dollar has now weakened to levels below pre‑conflict levels. The retreat in the safe‑haven currency points to a revival in risk appetite.
(Reporting by Nimesh Vora; Editing by Rashmi Aich)
Disclaimer: This report is auto generated from the Reuters news service. ThePrint holds no responsibility for its content.
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