Rupee Set for Firmer Open as Oil Prices Continue Decline

The Indian Rupee (INR) is expected to open stronger against the US Dollar (USD) on Thursday after a midweek holiday. On Tuesday, the USD/INR pair fell 0.35% to trade near 95.40, largely due to softer crude oil prices and a decline in US Treasury yields.

MCX Crude Oil futures have dropped more than 8.5% from their monthly high of Rs. 8,076 reached last week, currently trading at Rs. 7,660. A further retreat in crude benchmarks is anticipated to underpin the Rupee at the open.

Analysts at BNY note that Iran and Oman have engaged in talks on a temporary joint shipping corridor in the Strait of Hormuz, aiming to enhance maritime safety and potentially advance a permanent administration arrangement for the key oil transit route.