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Indian rupee slide poised for fleeting reprieve after oil rout extends

Дата публикации: 02-07-2026 03:01:22

MUMBAI: The Indian rupee is set to open marginally higher on Thursday, aided by a further drop in oil prices, though traders ​expect the relief to be short-lived amid weakness in Asian peers ‌and higher U.S. yields.
The Indian rupee is expected to open in the 95.14-94.18 range, per traders, after settling at 95.2475 on Wednesday.
The currency fell 0.6% on Wednesday, its largest ​decline in three weeks, breaching the 94.80-95.00 zone that traders had ​viewed as a key near-term support level.
Market participants had expected the ⁠Reserve Bank of India to defend that zone, citing evidence from recent ​sessions that suggested the central bank had been intervening to protect the 95 ​level.
While the RBI was seen selling dollars around 94.75 on Wednesday, once it stepped back, a wave of stop-loss orders, coupled with weak cues from Asian markets, accelerated the ​rupee’s decline.
Interbank “did not expect 95 to be breached, let alone see it ​test 95.25. Now that it has happened, the underlying trend (for dollar/rupee) is higher,” a currency ‌trader ⁠at a private bank said.
“Lower oil prices are obviously positive (for the rupee). However, that’s not what’s driving the market right now.”
The drop in oil prices, triggered by the US-Iran peace deal, showed no signs of abating. Brent crude ​fell 1% on Wednesday ​and dropped a ⁠further 1% in Asian trading, slipping below $71 a barrel.
The drop came amid remarks from Qatar that Iran and the ​United States had made “positive progress” in indirect talks concluded ​on Wednesday, ⁠with discussions centred on the Strait of Hormuz.
US yields bite
Most Asian currencies weakened on Thursday, weighed by rising US Treasury yields ahead of the US June ⁠payrolls ​report due later in the day.
Bond investors assessed comments ​from Federal Reserve Chair Kevin Warsh that reinforced a focus on containing inflation, while digesting the US ​ISM manufacturing and private payrolls data.

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