The Indian rupee was little changed around 95.2 per dollar, consolidating its recent gains as ongoing intervention by the Reserve Bank of India (RBI) and fading expectations of a September Federal Reserve rate hike lent support. The currency has been in recovery mode for the past two weeks, underpinned by regular RBI operations in the foreign exchange market.
Brent crude climbed to about $84.50 a barrel on Monday but remained well below its recent peak near $100, offering some relief for the rupee. The RBI also stepped in at the market open on Friday, underscoring its resolve to prevent uncertainty over oil prices from translating into unchecked pressure on the currency.
At the same time, investors scaled back wagers on a Fed rate increase in September after US employers unexpectedly cut 23,000 jobs in July. Fed funds futures now assign roughly a 44% probability to a hike, down from 55% before the release of the data. The RBI’s persistent presence in the FX market has helped shield the rupee from oil-driven headwinds and limit downside risks.
