Rupee Snaps Two-Day Rally to Settle at 94.60 Against US Dollar

The Indian rupee faced a minor setback on Tuesday, ending a two-session winning streak to settle 2 paise lower at 94.60 against the US dollar. Despite positive global cues regarding oil prices and geopolitical stability, domestic capital outflows prevented the currency from maintaining its upward momentum.

Geopolitical Stability and the Crude Oil Factor

The global energy landscape provided significant support for the rupee throughout the trading session. Tensions in West Asia have shown signs of de-escalation following a US-Iran peace framework agreement. This development is expected to lead to the reopening of the Strait of Hormuz, a critical maritime route for global oil and liquefied natural gas (LNG) exports.

The impact of this geopolitical shift was reflected in the crude oil markets, where Brent crude futures fell by 1.68 per cent to trade at $81.77 per barrel. For an economy like India, which relies on imports for nearly 90 per cent of its oil requirements, lower crude prices act as a major tailwind for the domestic currency.

FII Outflows Cap Domestic Gains

While the macro environment was largely favorable, the rupee’s recovery was capped by domestic market dynamics. Although Indian equity benchmarks saw gains—with the BSE Sensex rising 544.15 points to 76,808.48 and the NSE Nifty climbing 135.25 points to 23,989.15—the foreign institutional investor (FII) sentiment remained cautious.

Data from the exchanges revealed that FIIs remained net sellers, offloading equities worth ₹749.18 crore during the session. This outflow of foreign capital exerted downward pressure on the rupee, preventing it from capitalising fully on the easing of global oil prices.

Expert Outlook: Range-Bound Movement Expected

Market analysts suggest that while the rupee faced a slight dip, the broader trend remains relatively constructive. The USD-INR spot price is expected to navigate a specific corridor in the near term.

Anuj Choudhary, analis riset di Mirae Asset ShareKhan, mengantisipasi harga spot USD-INR akan diperdagangkan dalam rentang 94,10 hingga 94,90. Menambahkan perspektif lebih lanjut, Dilip Parmar dari HDFC Securities mencatat adanya potensi bias penurunan, yang menunjukkan bahwa level spot dapat bergerak menuju 94,10. Namun, ia memperingatkan bahwa 95,20 kemungkinan akan bertindak sebagai level resistansi yang kuat, sehingga membatasi pergerakan koreksi naik yang signifikan.

Saat dunia menyaksikan penandatanganan resmi kesepakatan damai AS-Iran di Swiss pada Jumat ini, volatilitas mata uang diperkirakan akan tetap terkait dengan kemajuan negosiasi diplomatik tersebut.

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