The Indian Rupee opened 12 paise stronger at 85.44 against the US Dollar on Monday, compared to its closing rate of 85.52 a dollar on Friday. This movement comes amid a backdrop of global economic developments and market reactions.
Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP, suggested that exporters could hedge at 85.70-75, while importers might wait to hedge near 84.25-50.
Brent oil prices ticked lower due to oversupply concerns and ongoing US-Iran nuclear deal talks. Additionally, Moody's downgrade of the US investment grade rating has added to market caution, Bhansali noted.
Despite a 1% gain in oil contracts last week, driven by the US-China agreement to temporarily lower tariffs, oversupply concerns have offset these gains, with Brent crude starting the week at $65.18 per barrel, he added.
"Moody's downgraded US by a notch changing the rating from top-tier rating AAA to AA. The agency sighted concerns over the country's ballooning $36 trillion debt that could worsen under President Trump's tax cuts," Bhansali said.
The dollar index was slightly lower at 100.84, while the US 10-year yield rose to 4.4910%. The Euro was at 1.1178, the British pound was at 1.3297, while the Japanese yen remained unchanged at 145.21.
The Nikkei fell by 0.44%, Hang Seng was down by 0.67%, and China declined 0.40%. Gift Nifty indicated a downside of 71 points at pre-open. Gold was up by $22 per ounce at $3,224.81.
Bhansali expects the rupee to trade within a wide band of 85-86 and a slightly narrower band of 85.25-75 for the day, with intraday selling near 85.70-75 and buying near 85.25.
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