Noida, May 6 (APAC News): The Indian rupee appreciated by 23 paise to 94.95 against the US dollar in early trade on Wednesday, supported by easing global crude oil prices and improving risk sentiment in domestic and Asian markets, according to forex traders.
At the interbank foreign exchange market, the domestic currency opened at 95.00 and strengthened to touch an early high of 94.95.
The gain marked a recovery from its previous close of 95.18 in the previous session.
Market participants attributed the rebound in the rupee to a decline in Brent crude oil prices, which eased to around the USD 108 per barrel mark.
Traders said easing geopolitical tensions in the West Asia region, coupled with signals of a potential diplomatic thaw, helped reduce concerns over energy supply disruptions, thereby supporting the rupee.
The US dollar index also softened in early Asian trade, offering additional support to emerging market currencies, including the Indian rupee. Broader Asian currencies traded higher against the greenback amid improved global risk appetite.
However, analysts noted that volatility in the currency market persists amid global uncertainties, including geopolitical developments and fluctuations in crude oil prices, which remain a key driver for India’s import-dependent economy.
On the domestic front, sentiment was also aided by positive cues from equity markets, with early indications suggesting firm opening trends in benchmark indices.
Forex dealers expect the rupee to trade in a narrow range in the near term, closely tracking movements in global oil prices, foreign fund flows, and US dollar trends.
On Tuesday, the rupee had witnessed heightened volatility, touching an all-time intraday low before recovering partially by the close, highlighting ongoing pressure in the currency market.
Market observers will continue to watch global macroeconomic signals, including US Federal Reserve policy cues and geopolitical developments, for further direction in the forex market.
News Agency Inputs
Disclaimer:Â Views expressed are those of experts and do not reflect APAC Media. This is for informational purposes only, not financial advice. We are not responsible for investment decisions. Please consult a qualified financial advisor before investing.
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