Virendra Pandit
New Delhi: The Indian rupee strengthened for the third consecutive session on Monday, its longest winning streak in a month, driven by market interventions by the Reserve Bank of India (RBI), and a slump in crude oil prices on hopes of a US-Iran peace deal to end the West Asian crisis.
The rupee closed at 95.23 per US dollar, up over 1.5 per cent since Wednesday last week, when it had hit a record low of 96.96/US dollar, the media reported.
The central bank’s dollar-selling intervention helped the Indian currency bounce back from its record low last week and optimism over a potential breakthrough in ongoing negotiations between Washington and Tehran shored up the currency further on Monday.
After its recent depreciation, one could argue that the rupee has become undervalued, RBI Governor Sanjay Malhotra said in a media interview.
The RBI does not target any specific level for the currency, he said, but emphasized that the central bank is ready to intervene if speculative pressures build up.
Finance Minister Nirmala Sitharaman also urged the people on Monday to focus on conserving fuel, fertiliser and foreign exchange, underlining Prime Minister Narendra Modi’s plea to conserve foreign exchange amid the Iran war.
Crude oil
Brent crude oil futures fell over 5 per cent to USD 97.8 per barrel, while Asian currencies and stocks gained as the prospect of a deal to end the Iran war buoyed risk appetite.
An Iranian foreign ministry spokesperson said conclusions had been reached on many topics discussed in a potential memorandum of understanding (MoU) with the US, but this did not mean Tehran was close to signing an agreement.