Rupee Extends Three-Day Winning Streak to Hit 95.88 as Regional Tensions Ease
The Indian rupee appreciated for the third consecutive session on July 28, gaining 11 paise against the U.S. dollar. Cooling crude oil prices and a temporary de-escalation in West Asia provided the necessary tailwinds for the currency.
Regional Diplomacy and Oil Prices Drive Gains
The Indian rupee maintained its positive momentum on July 28, finishing the session at 95.88 against the U.S. dollar. This 11-paise climb marks the third straight day of appreciation for the local unit. Market sentiment shifted as global oil prices retreated, largely influenced by a pause in direct hostilities between the United States and Iran. Brent crude dropped 2.63% to trade at $86.04 per barrel as mediators reported progress in returning both nations to the negotiating table.
Anuj Choudhary, Research Analyst at Mirae Asset ShareKhan, attributed the currency's strength to the cessation of strikes between Washington and Tehran. While U.S. President Donald Trump indicated that Iran had initiated contact for further discussions following intense economic pressure, Iranian officials have denied that any direct talks are currently taking place.
Market Volatility and Capital Outflows Restrict Momentum
Despite the gains, the rupee faced significant headwinds that kept it from rising further. The domestic equity market saw the Sensex slide 69.86 points to 76,765.92, while the Nifty dipped slightly to 23,985.35. Additionally, foreign institutional investors remained net sellers, offloading shares worth ₹1,688.23 crore on July 27.
The greenback also showed resilience, with the dollar index rising 0.08% to 101.46 as investors braced for the upcoming U.S. Federal Reserve policy announcement. Technical details from the trading session include:
- Opening Rate: 95.75 against the U.S. dollar.
- Intraday High: 95.63 reached during the session.
- Closing Rate: 95.88 (provisional).
- Previous Performance: A 54-paise jump on July 27 and a 20-paise increase on July 24.
Short-Term Outlook
Traders are now shifting their focus toward U.S. economic indicators, specifically the Conference Board consumer confidence data, for further direction. Analysts expect the USD-INR spot price to maintain a trading corridor between 95.35 and 96.05 in the immediate future. While the cooling of the West Asia crisis offers a reprieve, the combination of high dollar demand and consistent capital outflows from Indian markets suggests a cautious path forward for the rupee.
Source: The Hindu — Home
