The Indian rupee kicked off Friday on a high note, appreciating by about 10 paise against the dollar in a move tied closely to the impending RBI deadline. Banks face pressure to close out their offshore NDF arbitrage positions by April 10, driving this preemptive strengthening.
Opening quotes showed the local currency at 92.57, a rebound from Thursday’s 92.66 close. This follows RBI’s March directive capping daily net open rupee positions at $100 million. Banks’ requests for more time fell on deaf ears, compelling a swift unwind that could flood the market with dollar supply.
Experts predict a cautious market stance post-deadline, pending updates on overnight limits. ‘Any talk of rupee plunge after today is likely exaggerated,’ said a senior analyst. Meanwhile, soaring oil prices dominate trader radars amid US-Iran tensions. Brent held at $97/barrel (up 1.13%), WTI at $99.24 (up over 1%), recovering from sub-$100 slumps.
MCX crude futures for April touched 9,222 rupees, gaining 289 rupees or 3.23%. RBI Governor Sanjay Malhotra emphasized these forex restrictions as short-term tools to tame volatility fueled by bank arbitrage. With global cues mixed, the rupee’s gain underscores RBI’s steady hand in navigating turbulent waters, setting the stage for potential stability if oil eases.
