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Sensex 78,854.23 +2.01%Nifty 50 24,388.40 +1.79%₹ / $ 94.35

EconomyRupee

Rupee opens 29 paise stronger at 94.35 as Brent slips to $93

The currency rose for a fifth straight session on Thursday as oil kept falling on bets that a Democratic Congress will push Washington towards an exit from the Iran war.

From the editorial desk · MumbaiPublished
The Reserve Bank of India office in Bhubaneswar
The Reserve Bank of India office in BhubaneswarSubhrasingh / Wikimedia

Key points

  1. The rupee opened 29 paise higher at 94.35 to the dollar, against Wednesday's close of 94.64.
  2. It is the currency's fifth gain in a row.
  3. Brent crude fell $1.16 to $93.46 a barrel, down nearly 16% this week.

The rupee opened 29 paise stronger at 94.35 against the dollar on Thursday, extending its winning run to a fifth session as crude oil kept sliding after the US midterm elections.

The currency had closed at 94.64 on Wednesday. Its gains come as traders bet that the Democrats’ strong showing in Congress could push President Donald Trump towards a negotiated exit from the war with Iran, easing the threat to oil supplies that has weighed on India’s import bill for months.

Brent crude futures fell $1.16 to $93.46 a barrel, a fourth straight daily decline, while US West Texas Intermediate dropped $1.47, or 1.66%, to $86.65. Both benchmarks fell about 10% on Wednesday and settled below $100, and crude is down nearly 16% so far this week.

Shipments through the Strait of Hormuz have recovered to close to pre-war levels, though at a higher cost, which has also eased pressure on oil importers such as India. Cheaper oil cuts the dollars Indian refiners must buy, one of the biggest sources of demand for the US currency at home.

The dollar index, which tracks the US currency against six major peers, edged down 0.06% to 101.41 after a 0.36% fall in the previous session.

Shares rallied alongside the currency. The Sensex opened more than 1,600 points higher at 78,910.94 and the Nifty 50 rose 417.45 points to 24,378.05 at the start of trade.