The rupee climbed 33 paise to 93.13 against the US dollar in early trade on Monday due to recent actions by the Reserve Bank of India (RBI).
The rupee started gaining strength on Thursday when it climbed 5 paise. The trend continued on Monday despite rising fuel and energy costs.
The Indian equity markets were shut on Friday on account of Good Friday.
Besides, the currency has surged 1.8 per cent since last week — its best showing in four years — after the RBI imposed position limits on banks and corporates, curbing the onshore-NDF arbitrage activity.
The move triggered an unwinding of bank positions, leading to dollar selling in the markets.
Banks have been told to bring down their dollar holdings to the RBI-mandated level by April 10.
The rupee witnessed a decline since the onset of the war in Iran as energy prices skyrocketed amid disruptions in the Strait of Hormuz.
Following the global disruptions, India has started importing Iranian crude oil for the first time in seven years to meet its domestic demands.
Besides, it has also diversified crude oil sourcing from 27 to 41 countries, reducing reliance on the Strait of Hormuz to approximately 30 per cent, down from 45 per cent.
Major suppliers now include Russia, the US, Saudi Arabia, the UAE, and new additions like Argentina.
This diversification of energy procurement and RBI interventions on dollar-buying measures have allowed the rupee to gain some strength after the currency fell to an all-time low of 94 against one US dollar.
Also read: Sensex declines 112 pts, Nifty down 36 pts in early trade
Follow us
