Rupee Gains 8 Paise, Weak Dollar & Global Talks Lift Sentiment; Markets Watch US-Russia Talks

Mumbai: The Indian rupee started the week on a positive note, rising by 8 paise to reach 87.50 against the US dollar in early trade on Monday. This rise was mainly due to a weaker dollar globally and investor hopes tied to upcoming US-Russia talks.

At the interbank foreign exchange market, the rupee opened at 87.56 and soon touched 87.50, gaining from its previous close of 87.58.

Global Factors Influence Currency Movement

Forex traders said the rupee is expected to trade between 87.25 and 87.80 for now. Investors are waiting for key events this week — the Consumer Price Index (CPI) inflation data from both India and the US, and the important summit talks between the US and Russia scheduled for August 15.

Brent crude oil prices also dipped by 0.48 percent, trading at USD 66.27 per barrel, easing some pressure on India's import bill.

The US dollar index, which shows the dollar’s strength against six major currencies, fell slightly by 0.11 percent to 98.07, making the rupee relatively stronger.

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Hope From US-Russia Talks

Experts believe that the US-Russia summit could lead to a ceasefire in the Ukraine war, which might ease global tensions and benefit India. Anil Kumar Bhansali of Finrex Treasury Advisors said if the talks go well, it might also help India avoid additional 25 basis points tariffs imposed by the US.

India welcomed the talks and repeated Prime Minister Narendra Modi’s message that this is “not an era of war,” urging for peace through dialogue and diplomacy.

Rupee Plunges 52 Paise To Close At 87.70 Against US Dollar

RBI Steps In to Support Rupee

The Reserve Bank of India (RBI) has been actively supporting the rupee by selling dollars to stop it from weakening further. Exporters are expected to sell their near-term receivables, while importers might use any dips in the rupee to buy their needed dollars.

Forex Reserves Dip Sharply

India’s foreign exchange reserves fell sharply by USD 9.32 billion to USD 688.87 billion for the week ending August 1. This was one of the biggest weekly drops in recent months. In the previous week, reserves had increased by USD 2.70 billion.

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Stock Market Opens Positively

The Indian stock market also opened higher. The Sensex rose by 104.84 points to 79,962.63, and the Nifty climbed by 55.85 points to reach 24,419.15.

Foreign investors were net buyers on Friday, investing Rs 1,932.81 crore in Indian stocks after several days of selling.