The Indian rupee opened 15 paise stronger at 95.76 against the US dollar on Tuesday, 28 July, supported by sustained intervention from the Reserve Bank of India (RBI) and a sharp decline in crude oil prices, which helped offset the broader strength in the US dollar.
The domestic currency has staged a notable rebound after appearing set to breach the 97-per-dollar mark at Friday’s open. The recovery was driven by the RBI’s intervention to defend the currency, along with easing crude oil prices that reduced pressure on India’s import bill.
The RBI reportedly continued selling dollars on Monday, triggering stop-losses on long-dollar positions and accelerating the rupee’s gains. As a result, the Indian currency touched its highest level in two weeks and recorded its biggest single-day advance in around six weeks.
According to a Reuters report, a trader at a private-sector bank said the decline in oil prices alone would not have been sufficient to reverse sentiment towards the rupee. The trader noted that the RBI’s persistent intervention has been the key driver behind the currency’s recovery and is likely to keep speculative bets against the rupee in check over the next few sessions.
