From Tuesday’s life-time closing low of 95.28 to a dollar, the rupee advanced to 94.61/$ at close Wednesday, climbing to reflect the broader relief expected from lower automotive fuel prices in a country that is import-dependent for four-fifths of its energy needs.
To be sure, the rupee traded below 95/$ for the first half of the session, and later gained toward 94.60/$ after US President Donald Trump signalled a thaw in talks. The currency traded between 94.55/$ and 95.19/$ during the day.
“The rupee was near 95/$ for a long time before gaining. If the current stance on war were to persist and if there are no contradicting statements from Iran, we may see further gains towards 94/$,” said Anil Bhansali, head of treasury at Finrex Treasury Advisors.
The rupee logged its sharpest single-day gain since April 2, when regulatory measures by the central bank drove a rebound from record low levels, according to Reuters.
Bhansali expects the rupee to trade between the range of 94.25 and 95 on Thursday.
The level of 94.55/$ also triggered importer dollar demand, traders said.
