Indian Rupee Gains Amid Declining Oil Prices
The Indian Rupee (INR) has started the week on a positive note against the US Dollar (USD), with the USD/INR pair dropping to near 95.75.
This gain is attributed to the continued support from correcting oil prices, which have eased due to improving hopes of an increase in energy supply from Saudi Arabia and China's request for Iran's help in reducing Houthi attacks on behalf of Saudi Arabia.
The MCX Crude Oil contract expiring today (September 21) is down 2.8% to Rs. 9,400, which has positively impacted the INR due to India's reliance on oil imports.
Analysts at MUFG note that India's August inflation rose 4.8% yoy from a revised 4.5% month before, firmest since December 2024, and expect a gradual broadening of price pressures to keep headline inflation above 5% in the second half of the fiscal year.
India's Chief Economic Adviser (CEA) V. Anantha Nageswaran said that the economy aims to continue with prudent fiscal management despite uncertain outlook for oil, fertilisers.