The rupee on Wednesday opened 40 paise higher at 73.17 against dollar following a sharp decline in crude oil prices in the international markets and increased dollar selling by banks and exporters.
The local currency on Tuesday settled almost flat at 73.57 against the US currency.
Lower oil prices may reduce the risk of spiralling current account deficit (CAD), according to ICICIdirect.
Oil prices on Wednesday extended fall from the previous day, when crude slumped as much as 5 per cent, after Saudi Arabia said it would make up for supply disruptions from US sanctions targeting Irans petroleum exports from next month. Crude was hovering around $76.80 per barrel.
Overnight crude fell to the lowest level in two months as sell-off in global equity markets raised worries about demand growth and after Saudi Arabia said it could supply more crude quickly if needed. Saudi energy minister said that the oil market was in a “good place” and he hoped oil producers would sign a deal in December to extend cooperation to monitor and stabilize the market, according to Motilal Oswal Financial Services.
“Today, USDINR pair is expected to quote in the range of 73.05 and 73.50,” Motilal Oswal said in a report.
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