The Indian rupee snapped its three-session winning streak on Tuesday, 26 May, opening 15 paise lower at 95.38 against the US dollar as renewed geopolitical tensions in the Middle East dampened hopes of an imminent peace agreement between the United States and Iran. According to reports, experts also pointed to likely month-end dollar demand as a factor weighing on the domestic currency.
Sentiment turned cautious after US forces carried out what were described as “defensive actions” in southern Iran on Monday, raising concerns about a potential escalation in the region. Reflecting the increased risk premium, Brent crude futures climbed more than 2% to $98.3 per barrel, rebounding from their lowest levels in over two weeks.
The rupee had recovered from its record low of 96.96 per dollar touched last week, aided by optimism over a possible easing of hostilities in the Middle East and dollar-selling interventions by the Reserve Bank of India, which helped stabilise the currency market.
