Rising oil, US yields add to Indain rupee pressure after RBI move

Business Recorder reported that the Indian rupee was set to open weaker on Tuesday, as costlier crude and rising US bond yields compounded pressure from the Reserve Bank of India's decision to bring forward the deadline of its swap facility for non-resident Indian deposits. Traders expected the currency to start trading between 95.68 and 95.72 per dollar, having settled at 95.6025 on Monday.

Brent crude moved above $91 a barrel, while the yield on the 30-year US Treasury bond reached its highest point in over two decades. The truce expiry and Tehran's pledge to take a far more aggressive military stance drove crude higher, and that rise in turn lifted US yields. US President Donald Trump also told a Fox News reporter that Iran should surrender.

The rupee had already slipped beyond 95.50 on Monday following the RBI decision, which took most bankers by surprise, and central bank intervention did not halt the slide. A currency trader at a private sector bank called the outlook challenging, saying the RBI move had made the picture considerably weaker and that oil above $90 a barrel brings significantly larger downside risks. Oil-sensitive Asian currencies also dipped.