Latest news with #USDINR
Business Standard
5 days ago
- Business
- Business Standard
INR pares intraday gains to settle marginally lower
The Indian rupee gave up initial gains to settle 4 paise lower at 86.16 (provisional) against the US dollar on Friday, dragged by foreign fund outflows, rising global crude oil prices and a steep decline in domestic equity markets. However, a weak greenback against major currencies prevented a sharp depreciation in the local unit. Dollar index gave back recent gains and is quoting lower by 0.4% at 98.06. Meanwhile, Indian shares fell notably on Friday, with uncertainty over U.S. tariffs and a muted start to the quarterly earnings season weighing on markets. The benchmark S&P/BSE Sensex fell 501.51 points, or 0.61 percent, to 81,757.73 while the broader NSE Nifty index closed at 24,968.40, down 143.05 points, or 0.57 percent, from its previous close. At the interbank foreign exchange, the rupee opened higher against the US dollar at 85.99 and moved in the range of 85.97-86.23 before closing at 86.16 (provisional), down 4 paise from its previous close. On the NSE, USDINR futures were marginally lower at 86.17.
Business Standard
5 days ago
- Business
- Business Standard
Mild dollar pullback likely to support INR
Mild pullback in dollar overseas could likely support the Indian rupee in opening trades on Friday. Yesterday, rupee declined 15 paise to settle at 86.07 against the US dollar amid a stronger greenback, outflow of foreign funds and volatile global crude oil prices. Selling trend in the domestic equity markets and uncertainties over the outcome of the ongoing India-US trade talks further pressured the rupee. The benchmark S&P/BSE Sensex ended the session down 375.24 points, or 0.45 percent, at 82,259.24 despite mostly positive cues from global markets. The broader NSE Nifty index dropped 100.60 points, or 0.40 percent, to 25,111.45. At the interbank foreign exchange, the rupee opened at 85.93 against the US dollar and traded in the range of 85.80-86.09 during the day. On the NSE, USDINR futures pared early losses and settled only marginally lower at 85.97.
Business Standard
6 days ago
- Business
- Business Standard
INR weakens past 86 mark amid firm dollar
The Indian rupee declined 15 paise to settle at 86.07 (provisional) against the US dollar on Thursday amid a stronger greenback, outflow of foreign funds and volatile global crude oil prices. Selling trend in the domestic equity markets and uncertainties over the outcome of the ongoing India-US trade talks further pressured the rupee. The benchmark S&P/BSE Sensex ended the session down 375.24 points, or 0.45 percent, at 82,259.24 despite mostly positive cues from global markets. The broader NSE Nifty index dropped 100.60 points, or 0.40 percent, to 25,111.45. At the interbank foreign exchange, the rupee opened at 85.93 against the US dollar and traded in the range of 85.80-86.09 during the day before settling at 86.07 (provisional), down 15 from its previous close. On the NSE, USDINR futures pared early losses and settled only marginally lower at 85.97.
The Print
6 days ago
- Business
- The Print
Rupee falls 16 paise against US dollar
At the interbank foreign exchange, the rupee opened weak at 86.02 against the dollar. It traded in the range of 85.74-86.05 during the day before closing at 85.92, down 16 paise from its previous close. However, sliding global crude prices supported the domestic unit, according to forex traders. Mumbai, Jul 16 (PTI) The rupee declined 16 paise against the US dollar to close at 85.92 on Wednesday, as a strengthening American currency amid uncertainties over the India-US trade pact hit investor sentiment. In the previous session, the rupee appreciated 16 paise to close at 85.76 against the US dollar. 'The Indian rupee experienced notable volatility today, initially weakening against a robust US dollar before recovering mid-session due to dollar supply, only to conclude with net losses. 'This movement follows a three-day consolidation phase for the USDINR pair, ranging from 85.70 to 86.05. The sentiment remains acutely favourable for the dollar, driven by expectations of a hawkish Federal Reserve post-US inflation data and persistent uncertainties regarding India-US trade agreements,' Dilip Parmar, Research Analyst at HDFC Securities, said. An Indian commerce ministry team is in Washington for another round of talks on the proposed bilateral trade agreement. The four-day talks, which started on Monday, will conclude on Thursday. 'We continue to await the outcome of the trade deal as inflows and outflows keep the rupee well entrenched in a range of 85.70 to 86.10. We expect a similar range for the rupee tomorrow (Thursday) as well,' Anil Kumar Bhansali, Head of Treasury and Executive Director at Finrex Treasury Advisors LLP, said. Brent crude, the global oil benchmark, was down 0.26 per cent to USD 68.53 per barrel in futures trade. The dollar index, which gauges the greenback's strength against a basket of six currencies, dipped 0.07 per cent to 98.54. On the domestic equity market front, the Sensex rose 63.57 points to settle at 82,634.48, while the Nifty inched up 16.25 points to 25,212.05. Foreign institutional investors (FIIs) sold equities worth Rs 1,858.15 crore on a net basis on Wednesday, according to exchange data. PTI TRB SHW BAL SHW SHW This report is auto-generated from PTI news service. ThePrint holds no responsibility for its content.
Economic Times
6 days ago
- Business
- Economic Times
The impossible trinity of dollar weakness, subdued crude oil price & INR depreciation
In 2025, both dollar and oil prices have slipped to levels last seen more than three-years ago, which should have resulted in INR strength. However, USDINR has remained range-bound and even registered a mild depreciation over the last one year. The INR outcome reflects two factors: muted capital flows and RBI intervention. ADVERTISEMENT The balance of payments—comprising the current account and capital account—is tracking a US$0.8 billion surplus in Q1FY26, compared to US$5.2 billion inflows in Q1FY25. This reflects subdued capital inflows, with net FPI inflows at just US$0.4 billion in Q1FY26. Muted capital inflows are not unique to India and are visible across the EM space, where FPI inflows are down nearly 50% in the first five months of 2025. A key characteristic of 2025 is that dollar weakness has been triggered by risk-off sentiment. In previous cycles, such sentiment typically benefitted the dollar, viewed as a safe haven. However, there has been a fundamental shift in market perception of the US economy—driven not just by erratic trade policies, but also by rising concerns over the sustainability of US government debt. As a result, capital flows have been reallocated away from the US to other developed markets like the Euro Area and Japan, as investors seek alternative safe factor capping capital inflows into EMs is the Fed's cautious approach toward policy easing. After hiking rates by 525 bps post-Covid due to inflation pressures, the Fed has cut rates by only 100 bps since H2 2024. It has also continued shrinking its balance sheet, albeit at a moderate pace. Hence, EM capital inflows are expected to remain muted, with the Fed's rate-cutting cycle likely to stay the full year, India's balance of payments surplus is projected to rise to US$14 billion in FY26 versus a US$5 billion deficit in FY25, reflecting an improvement in FDI and ECB inflows. The loss of US exceptionalism should reduce repatriation pressures, supporting stronger net FDI inflows. ADVERTISEMENT Expectations of further Fed rate cuts and lower forward premiums have boosted ECB inflows. On the current account side, the deficit is expected to widen slightly to 1.1% of GDP in FY26 from 0.6% in FY25, due to weaker merchandise export growth stemming from global trade uncertainty driven by bilateral tariffs. RBI's intervention strategy has shifted over the past year, with FX market intervention reduced. As a result, two-way volatility in USDINR has increased in 2025. This shift reflects two developments: (1) a stronger monetary policy focus on domestic growth, and (2) a build-up of net dollar shorts in the RBI's forward book. ADVERTISEMENT Since the beginning of 2025, the RBI has supported growth using a mix of policy rate cuts and significant durable liquidity infusion. Limited FX intervention aims to avoid draining domestic or interbank liquidity during INR depreciation spells. The monetary policy priority is to maintain ample liquidity surplus to ensure effective rate forward book shows a net dollar short position—via buy-sell swaps—most of which mature within a year. This position, built in 2024 to limit FX reserve and liquidity impact from spot interventions, has been gradually reduced—from US$88.8 billion in February 2025 to US$65.2 billion by May 2025. The reduction has largely been led by the maturity of short-end swaps. RBI is also buying dollars in the spot market to neutralize the liquidity and reserve impact. ADVERTISEMENT Given the subdued capital inflows and still-large negative forward book, the RBI is expected to continue absorbing inflows when opportunities expectations of prolonged dollar weakness due to US fiscal concerns and softening growth, the INR is likely to face mild depreciation pressures. Nonetheless, fundamentals remain supportive—India's external debt-to-GDP ratio is low, exposure to tariff tensions is limited, and FX reserves are adequate. ADVERTISEMENT Overall, moderate depreciation is expected, driven by muted capital flows and prevailing risk-off sentiment. The USDINR is projected to rise to 86.50–87.00 by March 2026. (The author Gaura Sen Gupta is Chief Economist at IDFC FIRST Bank. Views are own) (Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times) (You can now subscribe to our ETMarkets WhatsApp channel) (Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of
