Rupee Strengthens on Oil Price Drop and Reserve Bank Intervention
The Indian Rupee has strengthened against the US dollar, rising to 95.12 after a 5% drop in global Brent crude oil prices. The Reserve Bank of India's (RBI) massive foreign exchange reserves, which have jumped by $6.118 billion to reach $682.354 billion, have provided a solid foundation for the rupee's upward trajectory.
Anil Kumar Bhansali, Head of Treasury at Finrex Treasury Advisors, confirmed that the lower Brent crude prices combined with sustained RBI intervention in the foreign exchange market provided a strong support for the rupee's appreciation.
The oil sell-off was triggered by US President Donald Trump's decision to delay a planned military strike on Iran, easing immediate fears of supply chain disruptions in the critical Strait of Hormuz. This has provided relief to major oil-importing economies, including India.