Rupee strengthens against US dollar in early trade on Monday
The Indian rupee strengthened against the US dollar in early trade on Monday as the US dollar weakened overseas and crude oil prices fell below $95 per barrel on optimism that the United States and Iran were moving close to a peace deal even though they remained at odds over key issues, including blockades on the Strait of Hormuz. US Secretary of State Marco Rubio said the United States and India are on the verge of finalizing an interim trade agreement following tremendous progress in negotiations, adding that the US Trade Representative will visit India very soon. Meanwhile, Reserve Bank of India Governor Sanjay Malhotra said the Indian rupee may now be undervalued following its recent depreciation. However, some gains were limited by persistent inflation concerns after India’s state-owned fuel retailers hiked petrol and diesel prices for the fourth time in May to offset losses stemming from higher costs linked to the Iran conflict. Foreign institutional investors offloaded equities worth Rs 4,440.47 crore on a net basis on Friday, exchange data showed. RBI said the country's forex reserves dropped $8.094 billion to $688.894 billion during the week ended May 15.
