The Indian rupee started stronger against the US dollar, opening 10 paise higher at 93 on Monday. This rise comes as traders unwind speculative positions in the offshore non-deliverable forwards market. Over the past week, the rupee has gained about 2% due to the Reserve Bank of India’s measures to control volatility and speculation in offshore markets.
The recent strict directives from the central bank, the RBI, have led banks to unwind arbitrage positions, impacting the offshore market significantly. Traders are also keeping a close eye on Brent crude prices and foreign institutional investor flows, which are influencing market sentiment.
The focus now shifts to the RBI’s Monetary Policy Committee meeting, which commenced on Monday and will end on April 8. Economists widely anticipate that the central bank will maintain interest rates at the current levels. Currently, the dollar/rupee pair is trading in the 92.80–93 range, supported by RBI intervention after cooling from recent highs near 94.80.
Market participants are closely monitoring crude oil prices globally, especially with rising geopolitical tensions following US President Donald Trump’s ultimatum to Iran regarding the Strait of Hormuz. Brent crude is trading around $110 per barrel, up nearly 1% from the previous session. In domestic markets, the Sensex fell 529 points, or 0.72%, to 72,790, while the Nifty declined 150 points, or 0.66%, to 22,561 in early trade.
