Rupee seen a winner in US-China trade thaw, but gains may be slow

Upcoming Lok Sabha polls, rising oil prices, RBI's efforts on stable exchange rate may drag down upward swing

With the United States and China sounding a reconciliatory track on trade talks, currencies of emerging markets, including the rupee, are poised to gain strength. However, the imp­ending general elections, rising oil prices and the Reserve Bank of India’s (RBI’s) efforts to maintain a stable exchange rate regime, may drag down the possible upward swing.  

US President Donald Trump delayed the deadline for imposing tariffs on Chinese products worth $200 billion, citing “substantial progress” during trade talks between the two nations. The Chinese stock jumped and yuan strengthened as a result. 

The yuan strengthened to 6.68 a dollar, from 6.79