More Stories

Informist, Thursday, Jul. 17, 2025

By Gowri Lakshmi

MUMBAI – The rupee ended at a three-week low against the dollar Thursday as banks purchased dollars on behalf of foreign portfolio investors and importers, dealers said. A slight rise in the dollar index after a fall in the Japanese yen also weighed on the local currency, dealers said. However, foreign fund inflows earlier in the day supported the rupee, they said. 

After falling to a near three-week low of 86.0925 against the dollar, the rupee settled at 86.0750, its lowest level since Jun. 25. The rupee moved in a range of over 30 paise during the day. 

Most other Asian currencies also fell against the dollar after the greenback strengthened amid rising concerns over the autonomy of the US Federal Reserve and the uncertainties around US tariffs. Most other Asian currencies fell over 0.3% against the greenback, with the Philippines peso and Indonesian rupiah being the worst hit.

The rupee started higher against the dollar as foreign banks sold the greenback for foreign fund inflows, likely relating to the qualified institutional placement of State Bank of India, dealers said. The bank's QIP worth INR 250.00 billion opened Wednesday.

Inflows were also on account of Reliance Power, according to some dealers. The company Wednesday said its board had approved plans to raise capital up to INR 90.00 billion through a combination of debt and equity instruments. Some overseas investors also invested in the domestic markets on optimism around a potential India-US trade deal.

Trump Wednesday said the much-anticipated interim trade deal is on track and could be signed soon. The proposed deal is likely to be in line with that between the US and Indonesia, Trump said. Dealers expect India to face 15-19% tariffs after the deal. The foreign fund inflows pushed the rupee to a high of 85.7900 a dollar in early trade.

However, the gains were quickly capped as importers purchased the greenback, fearing a sudden fall in the rupee amid rising uncertainty about US tariff policies, dealers said. In the past one week, the rupee has fallen three times below the psychologically crucial level of 86 a dollar. This has pushed importers to hedge their positions.

"Market didn't really react as much as it should have for the India-US trade deal news," a dealer at a private-sector bank said. "I think market has now factored in even the worst-case scenarios, and that's why we are seeing the outflows."

A few banks also purchased the greenback on behalf of overseas investors who withdrew funds and moved to other safe-haven assets. At 1530 IST, the benchmark stock indices, the Nifty 50 and the BSE Sensex, were down 0.4% and 0.5%, respectively. "Outflows were there in general and some $300 million were taken out as Anthem BioSciences outflow," a currency trader at a brokerage said. 

The rupee also came under pressure and hit the day's low as the dollar index strengthened following a fall in the euro and the Japanese yen. The dollar index, which measures the strength of the greenback against a basket of six major currencies, was broadly steady. At 1530, it was at 98.72, against 98.28 Wednesday and 98.64 Tuesday. Market participants now await the US initial jobless claims data for the week ended Saturday, due later in the day.

FORWARDS

The one-year dollar/rupee forward premium ended higher Thursday, tracking a fall in the benchmark US Treasury yield, dealers said. Some importers' dollar purchases, noting a fall in the rupee in the spot market, also pushed forward premiums higher, dealers said. Overall volumes in the currency market were low, dealers said. 

The 10-year benchmark US Treasury yield fell Wednesday amid reports that President Donald Trump might fire Fed Chair Jerome Powell. The 10-year US Treasury yield fell 4 basis points to close at 4.46% Wednesday.

Importers also purchased forward dollars, which pushed dollar/rupee forward premiums higher, dealers said. Market participants are unsure of the trajectory of US interest rates, which is keeping them from buying or selling forward dollars in large quantities, dealers said. This has led to a fall in overall volumes, they said.

At 1530 IST, the one-year exact period dollar/rupee forward premium was 1.96%, against 1.95% Wednesday. On an absolute basis, the premium was 168.83 paise, against 168.91 paise at the previous close.

OUTLOOK

Friday, the rupee will take cues from movement in the dollar index after US jobs data and crude oil prices, dealers said. The rupee may come under pressure if the dollar index remains strong. Importers may continue to purchase dollars fearing a further fall in the rupee.

Dealers expect outflows from Indian financial markets to continue, which may put the rupee under further pressure. However, some dealers said the Reserve Bank of India is likely to intervene in the currency market to support the rupee. Any tariff-related news will be closely watched by market participants. 

During the day, the rupee is seen moving in a range of 85.70-86.20 against the greenback. Dealers peg key technical support for the rupee at 86.10 a dollar. 

India Rupee - World FX: Australian dlr dn as jobless rate at over 3-yr high

MUMBAI – The Australian dollar slumped 0.9% against the dollar as Australia's unemployment rate hit a three-and-a-half year high, increasing the bets for a rate cut by the Reserve Bank of Australia in August. The government data shpwed that the jobless rate rose to 4.3% in June from 4.1% the month prior, the highest level since November 2021. The Reserve Bank of Australia was expecting the unemployment rate to peak at 4.3% by the end of the year.

Tracking the fall in Australian dollar, the New Zealand dollar was down 0.5% against the greenback. Any change in the Australian economy directly impacts the New Zealand dollar due to its close bilateral trade relations. 

The Japanese yen fell 0.5% against the dollar after Japan's exports fell for the second consecutive time in June. Japan's exports slipped 0.5% on year in June, extending the 1.7% fall in May and against the analyst expectation of a 0.5% rise amid the ongoing US tariff uncertainty. 

The dollar index recovered slightly following the fall in yen. The dollar experienced some sell off late Wednesday after reports said US President Donald Trump was planning to fire US Federal Reserve Chair Jerome Powell, which Trump denied hours later. However, Trump did not completely rule out the possibility, leaving investors on tenterhooks. 

"We're not planning on doing it," Trump said at the White House. "I don't rule out anything, but I think it's highly unlikely, unless he has to leave for fraud," referring to the recent criticism over the cost overrun in the renovation at the US Federal Reserve's headquarters in Washington. Meanwhile, Federal Reserve Bank of New York President John Williams Wednesday said that monetary policy was in the right place to allow central bankers to monitor the economy before shifting their policies, while hinting that the impact of Trump's tariff policies just beginning to hit the US economy. 

At 1518 IST, the dollar index, which measures the strength in the dollar against a basket of six major currencies, was at 98.68, a tad up from 98.28 Wednesday and 98.34 Tuesday. Market participants now eye the initial jobless claims data for the week ended Saturday, due later in the day. 

The euro was down 0.4% against the dollar. Eurozone consumer price index growth was at 2% on year in June, climbing from 1.9% in May. Core consumer price index, which excludes energy, food, alcohol and tobacco, was held steady at 2.3% for the second consecutive month. 

The pound sterling was down 0.1% against the dollar after data published Thursday indicated a softening labour market, increasing the expectation of a faster rate cut cycle by the Bank of England. The UK unemployment data showed the jobless rate rose to 4.7%, the highest level in four years, while the number of job vacancies also falling continuously. Earlier this week, Bank of England Governor Andrew Bailey said the central bank would cut rates if the jobs market showed signs of slowing down.

The Canadian dollar was down 0.5% against the greenback. The Swiss franc was down 0.3% after Switzerland's exports fell 5.3% to $87.53 billion during the June quarter. The fall in exports was largely attributed to a sharp fall in exports to the US, which fell 30% amid on-going US tariff policy uncertainties.  (Gowri Lakshmi)

India Rupee: Fwd premium inches up on fall in US yield; overall volume low

MUMBAI – The one-year dollar/rupee forward premium inched up Thursday, tracking a fall in the benchmark US Treasury yield, dealers said. Some importers' dollar purchases, noting a fall in the rupee in the spot market, also pushed forward premiums higher, dealers said. Overall volumes in the currency market were low, dealers said. 

"There is nothing happening in the market for the last few days, and volumes have been very less," a dealer with a state-owned bank said. "There is no moving factor for the market now."

The benchmark 10-year US Treasury yield fell Wednesday amid reports that US President Donald Trump might fire US Federal Reserve Chair Jerome Powell. Later however, Trump denied such reports, saying that it was "highly unlikely" he'd fire Powell unless there was fraud involved. The 10-year US Treasury yield fell 4 basis points to close at 4.46% Wednesday. 

Importers also purchased forward dollars, which pushed dollar/rupee forward premiums higher, dealers said. In the past one week, the rupee has fallen thrice below the psychologically crucial level of 86 a dollar. This has pushed importers to hedge their positions, mostly in near-term forward contracts, dealers said. 

Market participants are unsure of the trajectory of US interest rates, which is keeping them from buying or selling forward dollars in large quantum, dealers said. This has led to a fall in the overall volumes, dealers said. Further, the domestic liquidity surplus was largely steady at INR 3.11 trillion on Wednesday, from INR 3.00 trillion Tuesday. 

Market participants see strong technical support for the one-year dollar/rupee forward premium at 2.00% and resistance at 1.90%. At 1305 IST, the one-year exact period dollar/rupee forward premium was 1.96%, against 1.95% Wednesday. On an absolute basis, the premium was 168.83 paise, against 168.91 paise at the previous close.  (Sourabh Kumar)

India Rupee: Steady as importers' dollar buys offset foreign fund inflows

MUMBAI – The rupee came off highs and was nearly steady against the dollar Thursday as banks' dollar purchases on behalf of importers and overseas investors offset the impact of foreign fund inflows into Indian financial markets, dealers said. "We are seeing some outflows happening probably from the general uncertainties which has been baffling the markets lately, and some importer demand has come in," a dealer at a private sector bank said. 

Banks purchased dollars on behalf of importers, who feared a further fall in the rupee amid rising uncertainties and changing global landscapes, dealers said. Dealers, however, said that importer dollar purchases were not aggressive in nature. A few overseas investors also withdrew funds from the domestic stock market, which pulled the rupee down from its high of 85.7950 a dollar. At 1205 IST, the benchmark stock indices, the Nifty 50 and BSE Sensex, were both down 0.1% each. 

The rupee was also weighed down by a slight strengthening in the dollar index from early trade. At 1210 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 98.77, slightly up from 98.28 Wednesday and 98.34 Tuesday. 

Earlier in the day, the rupee was supported by foreign fund inflows, likely relating to the qualified institutional placement of State Bank of India and Reliance Power. Investors are also watching out for news related to the India-US trade deal, with most market participants expecting a tariff below 20% for India. US President Donald Trump Wednesday said talks between Washington and New Delhi are accelarating a deal is expected to be signed soon. 

For the rest of the day, the rupee is seen moving in a range of 85.75-86.05 against the greenback. Dealers peg key technical support for the Indian unit at 86.00 a dollar.  (Gowri Lakshmi)

India Rupee: Technical levels for rupee - Jul 17

MUMBAI – At 1039 IST, the rupee was at 85.8550 per dollar. At 0900 IST, the rupee was at 85.9050 a dollar, against the previous close of 85.9400. Following are the key support and resistance levels for the rupee as provided by leading banks and brokerages:

(Gowri Lakshmi)

India Rupee: Rises on foreign fund inflows; fall in other Asian caps gains

MUMBAI – The rupee rose against the dollar Thursday as foreign banks sold the greenback for foreign fund inflows, likely relating to the qualified institutional placement of State Bank of India and Reliance Power Ltd., dealers said. However, a fall in other Asian currencies limited the rupee's rise, they said. 

"It's likely some foreign fund flows into the SBI QIP. Market really hasn't reacted to Trump's comments on India-US trade deal," a currency trader at a broking firm said. 

SBI's qualified institutional placement worth INR 250 billion opened Wednesday, according to reports. Some dealers also said a few inflows were also related to Reliance Power, which on Wednesday said its board had approved plans to raise capital up to INR 90 billion through a combination of debt and equity instruments.

On the India-US tariff front, New Delhi is seeking to avert the reciprocal tariff of 26% and is also seeking easing of the 50% tariffs on steel and aluminium and 25% tariff on the auto sector. US President Donald Trump Wednesday said the much-anticipated interim trade deal is on track and could be signed soon, and the proposed deal is likely in line with that of the US and Indonesia. Indonesia will face 19% tariff on exports to the US from Aug. 1, as per the initial trade agreement. Dealers expect India to face 15-19% tariffs. 

However, the rise of the rupee was capped as most Asian currencies slipped in early trade as investors assessed the uncertainty with Trump's tariff policies and were worried on the US Federal Reserve's autonomy after reports said that Trump may fire US Fed Chair Jerome Powell. Trump, however, denied the initial reports about firing Powell, but also kept the door open to such an action. He said it is unlikely he would take such a step, unless Powell has to be fired for "fraud", referring to the recent criticism over cost overrun in the renovation of the US Federal Reserve's headquarters in Washington. 

The dollar index, which measures the strength of the dollar against a basket of six major currencies, was broadly steady. At 0943, the index was at 98.53, against 98.28 Wednesday and 98.64 Tuesday. 

The rupee's gains were also capped as a few banks purchased dollars on behalf of overseas investors, who withdrew funds from the domestic stock market to move to other safe haven assets. 

During the day, the rupee is seen moving in a range of 85.70-86.00 against the greenback. Dealers peg key technical resistance for the Indian unit at 85.70 a dollar.  (Gowri Lakshmi)

India Rupee: Expected range for rupee - Jul 17

MUMBAI – Following are the expected support and resistance levels for the rupee on Thursday, as forecast by leading banks and brokerages in an Informist poll: 

(Gowri Lakshmi)

India Rupee - Asia FX: Most down; rupiah falls as Bank Indonesia cuts rates

MUMBAI – Most Asian currencies traded lower against the dollar Thursday as investor sentiment was rattled after initial reports said that US President Donald Trump may fire US Federal Reserve Chair Jerome Powell. However, a few hours later, Trump clarified that he would not fire Powell, and such a scenario was highly unlikely. Markets had turned jittery after reports said that Trump told a room full of Republican lawmakers that he would fire Powell but later denied plans to do so. 

"We're not planning on doing it," Trump said at the White House. "I don't rule out anything, but I think it's highly unlikely, unless he has to leave for fraud." US Fed Chair Powell has been facing frequent public criticism from Trump and his administration for keeping the federal funds target range steady while the central bank monitors the impact on inflationary risks and labour market from tariffs. 

The dollar index reacted to the initial reports as investors were worried about the potential erosion of the US Federal Reserve's autonomy if Trump fires Powell. At 0731 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 98.47, broadly steady from 98.28 Wednesday and 98.34 Tuesday. 

The Indonesian rupiah slipped 0.1% against the US unit after Bank Indonesia lowered the benchmark lending rates for the fourth consecutive time since September. The Indonesian central bank on Wednesday lowered the benchmark 7-day reverse repurchase rate by 25 basis points to 5.25% and cut two other key rates as well. 

"BI is already all out in boosting economic growth, including in supporting loan growth," Bank Indonesia Governor Perry Warjiyo said. The central bank said the revised tariff deal with Washington was positive for the country amid weakening global trade and slowing domestic demand. 

The Thai baht was down 0.2% against the US dollar as Thailand's industrial sentiment hit a 9-month low due to tariff uncertainties. Thailand's industrial sentiment dropped to 87.7 in June from 88.1 in the previous month. 

The South Korean won fell 0.2% against the greenback. Bank of Korea Chief Rhee Chnag-yong Wednesday said that the country should enhance its legal and institutional framework in such a way that would strengthen Bank of Korea's central role in macroprudential policy decisions. 

"Unlike other major economies, the BOK (Bank of Korea) does not have direct macro prudential policy tools, nor does it have the authority to supervise the micro-economy," Rhee said. "This could prevent swift and effective policy responses when the government and the bank disagree on policy directions or their intensity."

The Taiwan dollar was down 0.1% and the offshore Chinese yuan traded flat against the greenback. The Malaysian ringgit was down 0.1% against the US dollar. Bucking the trend, the Philippines' peso was up 0.1% against the US unit after the country's Finance Secretary Ralph Recto said economic growth in the Philippines is likely to accelerate in the second half of the year.

"I think the second quarter, for sure, will be better than the first," Recto said. "Realistically, probably 5.7% to 5.8% for the year. But there's still a possibility. It depends because there's a lot of uncertainty. Uncertainty with trade policy." The Philippines' economy expanded 5.4% in the quarter ended March. (Gowri Lakshmi)  End

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Rajeev Pai

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

Informist Media Tel +91 (22) 6985-4000 

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2025. All rights reserved.