Rupee Rises Amid RBI Support, Crude Oil Pressures
The Indian rupee began September on an optimistic note, rising by 10 paise against the US dollar at the start of trading on Monday. The currency opened at 94.39 per dollar, a slight improvement over Friday's close of 94.49.
Experts attribute this gain to the Reserve Bank of India's continued presence in the foreign exchange market, which has helped limit the pressure on the rupee from higher oil prices and a stronger US dollar outlook.
However, crude oil prices remain a key risk for the Indian currency, with Brent crude rising to around $97 a barrel due to escalating tensions involving the US and Iran. This could lead to increased import costs for India, putting pressure on the rupee.
The US Federal Reserve's upcoming rate hike decision has also added another layer of complexity to the rupee's trajectory. Expectations of a September 15-16 rate hike have strengthened following stronger-than-expected US jobs data, which could support the US dollar and put pressure on emerging-market currencies like the rupee.