Latest news with #rupee
Reuters
8 hours ago
- Business
- Reuters
Middle East worries, portfolio inflow hopes feed rupee bears and bulls alike
MUMBAI, June 20 (Reuters) - Lingering concerns over a potential escalation in the Iran-Israel conflict, coupled with expectations of portfolio inflows are fuelling mixed views on the rupee's trajectory for the coming week, traders said. A spike in oil prices from a potential escalation in the conflict could weigh on the rupee, but an upcoming large IPO expected to draw foreign inflows may help recoup recent losses, they added. The rupee has declined little over 1% this month so far, with a large stock of its decline occurring after Israel attacked targets in Iran last Friday. The attacks also raised concerns about disruption of global oil prices, sending Brent crude oil futures to a five-month peak of $79 per barrel hit on Thursday. The currency hit a three-month low on Thursday but eased 0.1% to 86.63 as of 11:05 a.m. on Friday, comforted by a dip in oil prices after the White House said President Donald Trump will decide in the next two weeks whether the U.S. will become involved in the Israel-Iran air war. Meanwhile, expectations that Indian lender HDB Financial's $1.5 billion IPO is likely to draw sizeable inflows could are seen as a positive for the rupee, a trader at a private bank said. The trader pointed out that he would prefer to keep tight stop-losses on speculative positions since the risk of two-way moves next week could be elevated. On the technical front, the dollar-rupee pair is "nearing overbought territory, with a possible dip toward 86.35–85.95 before resuming an uptrend toward 87.80–88.00," said FX advisory firm Mecklai Financial said in a Friday note. On the day, most Asian currencies ticked up as well with the Korean won leading gains. The dollar index eased below the 99 handle while India's benchmark equity indexes, the BSE Sensex (.BSESN), opens new tab and Nifty 50 (.NSEI), opens new tab rose about 0.9% each.
Reuters
11 hours ago
- Business
- Reuters
Trump's Iran comments cool off oil rally, offering rupee respite
MUMBAI, June 20 (Reuters) - The Indian rupee is likely to open higher on Friday, buoyed by a decline in oil prices and a pullback in the U.S. dollar, while worries over the Israel-Iran conflict continue to linger. Non-deliverable forwards suggest the rupee will open in the 86.60 to 86.64 range, compared to 86.7225 in the previous session. The local unit fell to an over three-month low on Thursday, pressured by a surge in crude prices and hedging by importers. Brent crude futures were down 2%, having hit their highest level since mid-January on Thursday, amid the U.S. weighing whether to become involved in the Israel-Iran conflict. President Donald Trump will decide in the next two weeks whether the U.S. will become involved in the Israel-Iran air war, the White House said. This reduces speculation that the U.S. is planning to imminently join Israel in attacking Iran's nuclear facilities, ANZ Bank said, sparking a pullback in oil prices. "A consistent drop in oil is the best support the rupee can have," an FX trader at a private bank said. "The dollar's retreat, which is partly tied to reduced risk aversion, will help too. However, any meaningful rupee upside will need a material de-escalation in the Middle East conflict,' he said. The dollar index was back below the 99 handle while most Asian currencies were higher. The rupee, like most oil-sensitive Asian currencies, has been under pressure this week amid fears that a wider Middle East conflict could push oil prices higher and trigger a bout of risk aversion. The rupee is down 0.75% this week through Thursday, putting it on track for its worst weekly performance in one-and-a-half months. Brent crude, despite Friday's pullback, remained up nearly 4% for the week, adding to the nearly 12% surge it posted in the previous week. KEY INDICATORS: ** One-month non-deliverable rupee forward at 86.74; onshore one-month forward premium at 9.25 paise ** Dollar index down at 98.64 ** Brent crude futures down 2.3% at $77 per barrel ** Ten-year U.S. note yield at 4.39% ** As per NSDL data, foreign investors sold a net $69.2 mln worth of Indian shares on June 18 ** NSDL data shows foreign investors sold a net $2.8 mln worth of Indian bonds on June 18
Reuters
a day ago
- Business
- Reuters
Middle East tensions, importer dollar bids keep rupee on backfoot
MUMBAI, June 19 (Reuters) - The Indian rupee declined on Thursday to hover around its weakest level in over two months, as persistent worries about escalation in the Iran-Israel air war kept oil prices elevated and dented risk sentiment. The rupee was quoted at 86.6875, as of 12:20 p.m. IST, down 0.2% from its close of 86.4475 on Wednesday. Earlier in the session, it touched 86.71 - its lowest level since April 9. The dollar index was up about 0.2% at 99 and Asian currencies declined, as the possible entry of the United States into the week-old Israel-Iran air war kept financial markets on edge. The Israeli military said on Thursday it had targeted the nuclear reactor in the area of Arak in Iran overnight and what it called a nuclear weapons development site in the area of Natanz. The geopolitical tensions have sparked a jump in oil prices, with Brent crude futures last at $76.8 per barrel, up nearly 19% on the month so far. Traders also pointed to dollar demand from importers weighing on the rupee on the day. The rupee could decline towards 86.70-86.80 if dollar strength and elevated crude oil prices persist, said Amit Pabari, managing director at FX advisory firm CR Forex. Meanwhile, the U.S. Federal Reserve expectedly kept policy rates unchanged on Wednesday. Fed Chair Jerome Powell said that he expects "meaningful" inflation ahead as consumers pay more for goods due to the Trump administration's planned import tariffs.
Reuters
4 days ago
- Business
- Reuters
Rupee ends nearly flat following choppy trading; forward premiums dip
MUMBAI, June 16 (Reuters) - The Indian rupee experienced choppy trading before ending nearly flat on Monday as a broad based decline in the U.S. dollar blunted risk aversion spurred by the escalation in the Iran-Israel conflict. The rupee closed at 86.0650 against the U.S. dollar, nearly unchanged from its close of 86.08 in the previous session. The South Asian currency hovered in a 85.9525-86.23 range on the day with traders pointing to exporter hedging, oil prices and broad-based dollar weakness among the cues that impacted its trajectory. While "traders were biased towards buying dips (on USD/INR), the price action was somewhat confusing, leading to cutting of speculative positions," a trader at a state-run bank said. Meanwhile, the dollar-rupee forward premiums eased. The 1-year implied yield was down 5 basis points at 1.83%, weighed by an uptick in near-tenor U.S. Treasury yields and exporter hedging. The dollar index was down 0.3% at 97.9 and Asian currencies were trading mixed. The offshore Chinese yuan rose 0.1% while the Thai baht declined by about 0.3%. Investors are keeping a close eye on signs that the ongoing Iran-Israel conflict may escalate into a broader regional conflict. "All eyes are now on the trio driving market sentiment— war, trade wars, and central bank moves," said Amit Pabari, managing director at FX advisory firm CR Forex. Pabari expects the rupee to remain volatile in the near-term and reckons that an intensification of hostilities in the Middle East could push the currency towards 86.50-86.80. Meanwhile, India's merchandise trade deficit (INTRD=ECI), opens new tab narrowed to $21.88 billion in May, according to government data released on Monday. India and the U.S. aim to sign an interim trade deal before July 9, an Indian trade ministry official said on Monday.
Reuters
4 days ago
- Business
- Reuters
Rupee nearly flat, wedged between risk-aversion and exporter dollar sales
MUMBAI, June 16 (Reuters) - The Indian rupee was little changed on Monday as the impact of risk aversion spurred by an escalation of the Iran-Israel conflict ran into dollar sales from exporters and a rise in local equities. The rupee was at 86.0625 against the U.S. dollar as of 11:50 a.m. IST, nearly flat compared to its close at 86.08 in the previous session. India's benchmark equity indexes, the BSE Sensex (.BSESN), opens new tab and Nifty 50 (.NSEI), opens new tab, rose about 0.7% each, turning around from two days of losses spurred by rising geopolitical tensions in the Middle East. The conflict between Iran and Israel escalated over the weekend with both countries launching fresh attacks. Worries over the conflict pushed up crude oil prices with Brent futures quoting at $74.69 per barrel, up over 15% over June so far. "Rising geopolitical tensions have overshadowed positive inflation data from India, driving USD/INR above the 86.00-level. Higher energy costs could weigh on India's trade balance and stoke inflation," MUFG Bank said in a note. India's trade data for May is due later in the day. Economists polled by Reuters expect India's merchandise trade gap to have narrowed slightly to $25 billion last month, down from $26.4 billion in April. Traders said dollar-selling interest from exporters alongside a broad pullback in the greenback was supporting the rupee. The dollar index was down 0.1% at 98.1 while Asian currencies were trading mixed. The focus this week will be on a series of central bank policy decisions, including the U.S. Federal Reserve on Wednesday. The Fed is widely expected to keep rates unchanged with market participants focusing on future projections for policy rates alongside commentary from Chair Jerome Powell.
