USDINR Rallies as US-Iran Tensions Ease

The US dollar came under pressure after the US halted its strikes against Iran following 13 days of attacks. In response, Iran said it would maintain a ceasefire as long as the US remains on pause.

This development has led to optimism among traders, who see it as an early sign of potential de-escalation in the conflict. As a result, oil prices have dropped, which has boosted the Indian Rupee.

The rupee is likely to remain supported amid these de-escalation expectations, but a re-escalation could quickly erase its recent gains and push it into new record lows.

The US Fed's rate decision on Wednesday will be one of the most important events of the week. While interest rates are expected to remain steady following soft US inflation data, traders will be watching for any surprises, including a rate hike or dissenting votes.