The Indian rupee opened 35 paise higher at 95.34 against the US dollar on Monday, 25 May, supported by improving risk sentiment amid hopes of a potential resolution to the Iran conflict. Investor confidence also received a boost from recent comments by Reserve Bank of India Governor Sanjay Malhotra regarding the domestic currency.
In an interview with Mint, Malhotra said the central bank would do “whatever is required” to ensure orderly movements in the foreign exchange market, adding that the rupee appears undervalued following its recent sharp decline.
His remarks came after two consecutive sessions of strong intervention by the Reserve Bank of India in the currency market, according to traders. The intervention helped the rupee recover from its record low of nearly 97 per dollar touched last Wednesday.
(more to come)