By Nimesh Vora
MUMBAI, April 28 (Reuters) – The Indian rupee is set to slip at Tuesday’s open, with oil prices near a three‑week high and a weaker tone across Asian currencies.
The rupee is expected to open in the 94.25-94.30 range, according to traders, having settled marginally higher at 94.19 on Monday.
The currency has steadily weakened from the high of around 92.70 hit 10 days ago, with oil-linked flows and hedging-related dollar demand chipping away at the positive sentiment created by the Reserve Bank of India’s measures to support the rupee.
Oil appears to have settled at a higher level, leaving limited scope for sustained relief for the rupee, a currency trader at a private-sector bank said.
On a day-to-day basis, there is heavy dollar buying by oil refiners, with little offsetting supply expected and limited RBI intervention anticipated.
The RBI has been intervening to alleviate pressure on the rupee, traders said.
However, the support has largely been selective, with the central bank supplying dollars up to specific levels before stepping back, rather than defending the currency aggressively, they said.
OIL REMAINS A PAIN POINT
It has been two months since the U.S. and Israel attacked Iran, and while a ceasefire has remained in place since early April, oil flows through the Strait of Hormuz have yet to resume.
Analysts see the lack of shipments through the key transit route as a major obstacle to any cooling in oil prices.
Brent crude for June climbed more than 1% to $109.40 a barrel on Tuesday, potentially extending its winning streak to seven sessions. Faltering efforts to halt the U.S.–Iran conflict underpinned prices.
Most Asian currencies weakened, compounding the pressure from oil prices on the rupee. The dollar index inched up.
(Reporting by Nimesh Vora; Editing by Harikrishnan Nair)
