The rupee fell 4 paise to 85.72 against the US dollar in early trade on Monday amid rising Brent crude prices and reduced yield appeal after RBI’s 50 bps rate cut. Traders expect short-term pressure on the currency.
Sensex and Nifty opened with sharp gains on Monday following a 50 basis point rate cut by the RBI and positive global market trends. Midcaps led the rally, while investor sentiment was boosted by Wall Street and Asian market strength.
Forex traders noted that expectations of an RBI rate cut in the upcoming MPC meeting—driven by easing food and energy prices—are dampening short-term sentiment for the rupee, despite the potential for such a move to support long-term economic growth.
