Rupee Regains Strength with RBI Intervention
The Indian rupee regained some strength against the US dollar on Monday, closing at 95.17 after rising by 26 paise from its previous close. This is a significant recovery for the rupee, which had been under pressure due to rising crude oil prices and geopolitical tensions.
According to Dilip Parmar, Senior Research Analyst at HDFC Securities, timely intervention from the Reserve Bank of India (RBI) likely played a crucial role in supporting the currency. The RBI's special USD-INR forex swap facility for FCNR(B) deposits has mobilized foreign exchange inflows of $73 billion as of August 21.
The rupee had initially opened at 95.56 and oscillated between 95.11 and 95.56 during the session, before settling at 95.17 by the end of the day. The dollar index was trading lower by 0.18% at 99.52, while Brent crude prices rose by 3.70% to $91.36 per barrel.
The RBI's intervention and better-than-expected flows under the FCNR(B) scheme have boosted investor sentiments. However, the Commerce Ministry will hold a meeting with industry associations and representatives of export promotion councils on September 1 to discuss India-U.S. trade performance.