The Indian rupee is positioned to extend its recent gains at Thursday’s open, with traders expecting the currency to trade in the 95.04-95.08 range per US dollar.
This follows a settlement of 95.1175 on Wednesday, marking a continued appreciation against the greenback.
The currency’s strength is being underpinned by two primary factors: a broad weakening of the US dollar and a significant decline in global oil prices.
Crude benchmarks have slipped below levels seen prior to the recent escalation of tensions involving Iran, providing relief to India’s import bill and current account dynamics.
Additionally, market sentiment has shifted as the probability of a Federal Reserve rate hike has diminished.
The fading odds of tighter US monetary policy have reduced pressure on emerging market currencies, allowing the rupee to benefit from the broader dollar softness.