After struggling and devaluation for months, the Indian Rupee is finally gaining momentum in global currency market as it witnessed a jump of 96 paise yesterday, on 2nd November – adding more value for itself against the US Dollar.
In past two days, the value of rupee has recovered by 2% against the US dollars – including a 96 paise recovery within a day. Currently, the rupee is strengthened by 101 paise and set to 72.44 against the dollar, within two days to witness its highest rise since September 2013. Although the rupee value is down by 13 percent against the US dollar this year, but recently, the Rupee gained the highest single-day jump of around 50 paise – and this seems to be a continuing trend since two days.
The falling value of rupee was cited to be an outcome of multiple factors affecting at once, but currently its value has reached at 72.45 against the US dollar on easing crude oil prices. Another factor that has affected the rupee instantly is the possibility of US sanction relief and the grant of waivers to India from sanctions on Iranian oil imports. Although the main reason behind the rupee price gaining is the constantly decreasing crude oil prices, other factors like the cash flow in equity market and fresh foreign fund inflows in the market.
“There were massive long dollar positions, which got hit once the rupee broke the 73 level. Large corporates sold dollars and squared up long positions. The next key trigger will be the mid-term US polls,” said a new agency Reuters. To save the dollar from falling, the US government said that it will allow eight countries to continue importing oil from Iran, only at very low levels the re-imposition of sanctions. The exemption on the import of oil from Iran was being granted to the countries that have promised to cut the purchase or already reduced the purchase of oil from Iran. For now, rupee is expected to touch 72 against the US Dollar by the next week following the trend.