Rupee opens 20 paise up at 71.74 against dollar

The rupee on Tuesday opened 20 paise higher at 71.74 against the US dollar after crude oil prices edged down as the market calmed, while the world braces for Iran’s response to the killing of its top military commander by the United States.

The local currency declined to the lowest level in two months on Monday following a sharp surge in global crude oil prices and was further weighed down after as escalating US-Iran tensions fanned fresh fears of conflict in the Middle East. The domestic unit settled the day at 71.93 against the US dollar, down 13 paise against the previous close.

US President Donald Trump has warned Iran of “major retaliation” if Tehran carries out any attack against America to avenge the killing of top military commander Qassem Soleimani and hinted at striking its cultural sites.


In yesterday’s session, crude oil prices pared gains on growing doubts that Iran would strike back in a way that would disrupt oil supplies. In the last couple of sessions, crude oil prices jumped sharply after a US airstrike in Iraq.

“Today, market participants will be a little cautious as more updates on the rising geopolitical tensions will keep the volatility high for currency. Today, USDINR pair is expected to quote in the range of 71.70 and 72.25,” brokerage Motilal Oswal Financial Services said in a report.

Japanese Yen strengthened against the US dollar but all of the gains were trimmed as market sentiment remained cautious amid concerns about a broader escalation of Mideast conflicts after the United States killed Iran’s most prominent military commander.

On the other hand, Euro remained higher against the US dollar and for today focus will be on the preliminary inflation number and the better-than-expected number could keep the currency supported on lower levels.