Iran ceasefire offers Indian rupee major boost ahead of RBI policy; oil plummets

MUMBAI: The Indian rupee is set to open higher on Wednesday in the run‑up to the central bank’s policy decision, buoyed by plunging ​oil prices and the rally in Asian currencies after a two‑week Middle ‌East ceasefire.

The rupee is likely to open in the 92.40-92.50 range versus the US dollar, having settled at 93.0075 on Tuesday.

Brent crude June futures plunged nearly 14% to $94.10 a barrel, ​US equities rallied more than 2%, while South Korean and Japanese shares ​climbed 6% and 5%, respectively.

US Treasury yields and the dollar ⁠index fell, and the South Korean won led the rally in Asian currencies, ​jumping 1.5%.

A two‑week Iran ceasefire agreed by US President Donald Trump on Tuesday boosted risk ​assets, lifted Asian currencies and dragged oil prices lower.

The ceasefire will be a major relief for markets, which over the past several weeks have had to contend with uncertainty over ​how long the conflict might drag on and the potential impact on inflation.

The ​agreement was reached less than two hours before Trump’s deadline for Tehran to reopen the Strait ‌of ⁠Hormuz or face what he said would be devastating attacks on its civilian infrastructure.

“This is a positive de-escalation signal for markets, especially with Hormuz reopening,” said Charu Chanana, chief investment strategist at Saxo, Singapore.

“From here, the key questions are whether ​talks keep progressing ​during this two-week ⁠window, how quickly energy flows and shipping activity normalise in practice.”