Rupee Seen Under Pressure Amid Renewed U.S.-Iran Tensions; Equities Poised to Rebound

The Indian rupee is expected to remain under pressure on Thursday after falling to a one-month low in the previous session, as renewed concerns over U.S.-Iran tensions raise fears of another spike in crude oil prices.

The rupee is likely to open flat to slightly weaker against the U.S. dollar, after declining 0.6% on Wednesday.

In the NDF market, the Indian rupee is trading at 95.55-60, after closing at 95.5550 on Wednesday.

The Indian rupee has surged over 1% in the past two sessions, with traders attributing the move to aggressive intervention by the Reserve Bank of India aimed at pushing the dollar/rupee pair lower.

Indian equity markets are expected to open higher on Thursday, recovering from their steepest single-day decline in three months. However, investor sentiment is likely to remain cautious amid renewed geopolitical tensions in the Middle East.

The U.S. military announced fresh strikes on Iran on Wednesday, aimed at keeping the strategically important Strait of Hormuz open for shipping. The escalation came after U.S. President Donald Trump said that the interim agreement to end the conflict was over.

GIFT Nifty futures were trading at 23,995.5, indicating that the Nifty 50 could open above Wednesday’s closing level of 23,882.05.

In the previous session, both the Nifty 50 and Sensex declined by more than 2%, recording their biggest one-day losses in three months, as renewed geopolitical uncertainty weighed heavily on market sentiment.