Indian Rupee: Seen extending upside amid dollar weakness

The Indian rupee is seen extending upside in opening trades on Monday as weak dollar, lower oil prices and expectation of a positive start to local equities support. Rupee opened higher at Rs 85.61 per dollar and hit a low of 85.60 so far during the day. On Friday, INR saw good gains against the US dollar after the Reserve Bank of India (RBI) cut interest rates by half a percent, continuing to witness good support around 86 threshold. RBI has slashed its key lending rate, or the repo rate, by 50 basis points to 5.5% amid softening inflation. INR added 16 paise at 85.64 per US dollar. Local stocks soared following this with the NIFTY50 index zooming up 1% to hit 25K mark. Reserve Bank of India (RBI) Governor Sanjay Malhotra also noted that with the moderation in trade deficit in Q4:2024-25, alongside strong services exports and remittance receipts, the current account deficit (CAD) for 2024-25 is expected to remain low. On the NSE, USDINR pair eased slightly to 85.73 tracking loses in dollar overseas.

 

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