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Informist, Tuesday, Oct. 14, 2025

 

By Rati Chaphekar 

 

MUMBAI – The rupee ended lower against the dollar Tuesday as banks persistently bought dollars on behalf of importers and foreign portfolio investors, dealers said. However, as has been the case for the past few weeks, the Reserve Bank of India did not let the Indian currency fall to a record low, they said. 

 

"The rupee has hovered around its record low all day, but did not breach the lifetime low. However, considering the buying (of dollars) pressure, I think we can see a new record low later this week," a dealer at a private-sector bank said.

 

After trading in a tight range of eight paise during the day, the Indian unit ended the day at the record closing low of 88.7975 a dollar, which was earlier touched on Oct. 8 as well.  

 

The rupee started the day lower against the dollar as banks rushed to buy dollars on behalf of importers, who wanted to make the most of dollar/rupee levels, wary of further depreciation of the rupee. The Indian unit had received a slight boost Monday as traders grew hopeful of progress in the India-US trade negotiations, following media reports that the Indian team is leaving for the US for the next round of trade talks this week. Dealers said among importers, oil marketing companies, and gold importers were likely the main dollar buyers. 

 

Foreign banks also bought dollars to cover foreign fund outflows from domestic equities due to the unallotted shares of the initial public offering of domestic companies. Rubicon Research Ltd. and Canara Robeco Asset Management Co. Ltd.'s IPO closed on Monday. IPOs of Tata Capital Ltd. and LG Electronics Ltd. had closed for public subscription last week.

 

The rupee was also weighed by a rise in the dollar index as US President Donald Trump's toned-down comments against tariffs on China and a potential meeting with his Chinese counterpart led to expectations of de-escalation in tensions between the two economic powers. US Treasury Secretary Scott Bessent said on Monday that Trump remains on track to meet Chinese leader Xi Jinping in South Korea in late October as the two sides try to de-escalate tensions over tariff threats and export controls. 

 

Trump Friday announced an additional 100% tariff on China after Beijing expanded export controls on rare earths earlier in the week. At 1530 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 99.42, against 99.25 Monday and 98.85 Friday. 

 

However, the central bank likely sold dollars persistently around 88.80 a dollar, preventing the rupee from falling to its lifetime low, dealers said. In the last few weeks, the RBI has actively intervened in the currency market to protect the 88.80 a dollar level. "The RBI was suspected to intervene at 88.80 levels, strongly keeping it below the level and to contain the excess volatility due to constant dollar buying," Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP, said. 

 

 

	AT 1530 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	88.7975	88.7375	88.7200	88.8000	88.6700
1-year dlr/rupee fwd (paise)	199.45	197.57	200.33	196.80	197.00

 

FORWARDS

The one-year dollar/rupee forward premium ended higher, tracking a fall in US Treasury yields as market participants kept a close watch on developments related to renewed trade tensions between the US and China, dealers said. Forwards of a currency pair are reflective of the interest rate differential between the two countries.

 

US Treasury yields also fell as traders awaited a speech by Federal Reserve Chair Jerome Powell later in the day, which could offer more insight on future rate cuts in the US. The 10-year US Treasury yield fell to a near one-month low of 4.01% on Tuesday. 

 

Further, some banks bought dollars for forward delivery on behalf of importers, who expect the rupee to depreciate going forward, which also supported premiums, dealers said. However, gains in forward premiums were limited as a 99-month low retail inflation print in September boosted expectations of an interest rate cut by the RBI in December, dealers said. 

 

Data released Monday showed CPI inflation fell to 1.54% in September, the second-lowest print in the current series that has data since 2013. So far this calendar year, the RBI's Monetary Policy Committee has lowered the repo rate by 100 basis points to 5.50%, with the rate last cut in June.

 

At 1530 IST, the one-year exact period dollar/rupee forward premium was 2.25%, against the previous close of 2.22%. On an absolute basis, the premium was 199.45 paise, against 197.00 paise Monday.

 

OUTLOOK

On Wednesday, the rupee will take cues from movement in the dollar index and other Asian currencies after Fed Chair Jerome Powell's speech later in the day, dealers said. However, they expect the RBI to continue intervening through dollar sales and prevent the rupee from testing the psychologically crucial level of 89.00 a dollar.

 

Market participants will continue to closely monitor developments related to India-US trade talks. They will also monitor developments related to US-China trade tensions. 

 

Dealers also expect importers to continue buying dollars, wary of a further rupee decline in rupee, which would exert pressure on the local unit. "Considering it's Diwali next week, we may see strong dollar demand by gold importers," a dealer at a private-sector bank said. "So we can see the rupee going to 89.00 a dollar next week, also the month-end payment demand might kick in."

 

The rupee is expected to move in a range of 88.50 to 88.90 against the dollar. Immediate technical support for the rupee is pegged at 88.80 per dollar, which, if broken, can push the rupee to 89.00 a dollar, they said.

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India Rupee - World FX: Pound sterling slumps on weak wage data; yen up 0.2%

 

 

	AT 1605 IST	HIGH	LOW	PREVIOUS
GBP/USD	1.2157	1.2168	1.2129	1.2145
EUR/USD	1.0182	1.0185	1.0154	1.0169
NZD/USD	0.6296	0.6299	0.6266	0.6270
AUD/USD	0.6965	0.6968	0.6935	0.6947
USD/JPY	134.1720	134.3130	133.4230	133.8330
USD/CAD	1.2847	1.2855	1.2835	1.2842
EUR/JPY	136.6130	136.6640	135.6480	136.0870
CHF/USD	1.0402	1.0414	1.0393	1.0410
EUR/CHF	0.9788	0.9789	0.9763	0.9766

 

MUMBAI – The pound sterling fell 0.6% against the dollar after data released Tuesday showed growth in average UK earnings slowed slightly in the three months to August, indicating the Bank of England may be able to continue cutting interest rates, though at a more cautious pace.

 

Average weekly earnings, excluding bonuses, were 4.7% higher in Jun-Aug than a year earlier, slightly weaker than an increase of 4.8% in the three months to July and the slowest since May 2022. The Swiss franc fell 0.1% against the greenback and the euro traded steady.

 

The Japanese yen rose 0.2% against the dollar after Finance Minister Katsunobu Kato Tuesday said Japan needs to come up with a new economic strategy that suits the current situation where inflation, instead of deflation, has become a concern unlike in the times of "Abenomics" stimulus policies. "Abenomics" refers to policies intoduced by the former prime minister Shinzo Abe, a mix of bold monetary easing, flexible fiscal policy, and reform, which helped the economy escape more than a decade of deflation but ran up massive government debt.

 

The dollar index rose further in European trade as US President Donald Trump's toned-down comments on tariffs on China and a potential meeting with his Chinese counterpart led to expectations of a de-escalation of the trade spat between the two economic heavyweights.

 

Trump had Friday announced an additional 100% tariff on China after Beijing expanded export controls on rare earths earlier in the week. The US will levy an extra 100% tariff on imports from China, along with export controls on "any and all critical software", from Nov. 1, Trump had said. At 1604 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 99.42, against 99.25 Monday and 98.85 Friday

 

The Australian dollar fell 0.8% against the dollar amid uncertainty related to the US-China trade spat. China and Australia share close bilateral ties. The New Zealand dollar fell 0.6% against the greenback.

 

Australia's central bank saw no need for an immediate cut in interest rates at its September policy meeting, given some stickiness in services inflation and steady employment. Future easing would be data-dependent, minutes of the meeting, released Tuesday, showed.  (Rati Chaphekar)

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India Rupee: Stays down as importers, FPIs buy dlrs; RBI prevents record low

 

	AT 1324 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	88.7800	88.7375	88.7200	88.7975	88.6700

 

MUMBAI – The rupee remained lower against the dollar, hovering near its record low, as banks bought dollars for foreign portfolio investors and importers, dealers said. However, losses in the Indian unit were limited as the Reserve Bank of India likely sold dollars through public sector banks, which prevented the rupee from falling to a lifetime low. So far on Tuesday, the rupee has moved in a range of just 8 paise. 

 

Some dealers said banks purchased dollars for foreign fund outflows from equities on account of the unalloted shares of initial public offering of domestic companies. Rubicon Research Ltd. and Canara Robeco Asset Management Co. Ltd.'s IPO closed on Monday. IPOs of Tata Capital Ltd. and LG Electronics Ltd. had opened for public subscription last week.

 

"We saw FPI outflows in a good volume," a dealer at a state-owned bank said. "This might be the unalloted funds that are going back after various IPOs (initial public offerings) last week."

 

The central bank likely sold dollars persistently around 88.79 a dollar, dealers said. The Indian unit touched a low of 88.7975 a dollar during the day, just shy of its lifetime low of 88.8025. In the last few weeks, the RBI has actively intervened in the currency market to protect 88.80 a dollar.

 

Further, some banks bought dollars on behalf of oil marketing companies and other importers, wary of a further depreciation in the rupee, which further weighed on the Indian unit, dealers said. Gold importers also bought the greenback, according to some dealers. 

 

The dollar index rose further in European trade as US President Donald Trump's toned down comments against tariffs on China and a potential meeting with his Chinese counterpart led to expectations of de-escalation in tensions between the two economic heavyweights. At 1324 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 99.26, against 99.25 Monday and 98.85 Friday

 

For the rest of the day, the rupee is seen moving in a range of 88.60 and 88.90 against the greenback. Dealers peg immediate technical support for the rupee at 88.80.  (Rati Chaphekar) 

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India Rupee: Technical levels for rupee - Oct 14

 

MUMBAI – At 1100 IST, the rupee was at 88.7800 per dollar. At 0900 IST, the rupee was at 88.7375 a dollar, against the previous close of 88.6700 a dollar. Following are the key support and resistance levels for the rupee as provided by leading banks and brokerages:

 

Participants	S2	S1	R1	R2
Private-sector bank	88.90	88.80	88.50	88.40
Brokerage firm	89.00	88.80	88.40	88.20
Brokerage firm	88.85	88.80	88.40	88.20

 

(Rati Chaphekar)

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India Rupee: Falls as oil cos, importers buy dollars; RBI intervention eyed

 

	AT 0945 IST	AT 0900 IST	HIGH	LOW	PREVIOUS(AT 1530 IST)
Spot rupee per $1	88.7600	88.7375	88.7200	88.7725	88.6700

 

MUMBAI – The rupee fell against the dollar Tuesday as banks bought dollars for oil marketing companies and other importers, dealers said. "Yesterday (Monday) there was some optimism in later part of the day because of the India-US trade deal news, but it was momentary," a dealer at a private sector bank said. "The usual buying (of dollars) by importers bought the rupee back to its normal level."

 

Banks bought dollars on behalf of importers, who wanted to make the most of current dollar-rupee levels, wary of further depreciation in the Indian currency, dealers said. The dollar index was broadly strong as US President Donald Trump's toned-down comments against tariffs on China and a potential meeting with his Chinese counterpart led to expectations of de-escalation in tensions between the two economic heavyweights. At 0945 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 99.26, against 99.25 Monday and 98.85 Friday.

 

However, dealers expect the Reserve Bank of India to step in through dollar sales at around 88.80 a dollar, as has been the case in the past few weeks, to prevent the Indian unit from hitting a record low. "I am seeing the same range-bound trade for the rupee. RBI will stand in the way of 89 (a dollar) for as long as possible, I think," a dealer at a state-owned bank said. 

 

Market participants will continue to keep a close eye on fresh developments on India-US trade deal negotiations, especially after media reports Monday said an Indian team was leaving for the US for the next round of trade talks this week.

 

For the rest of the day, the rupee is seen moving in a range of 88.60 and 88.90 against the greenback. Dealers peg immediate technical support for the rupee at 88.80.  (Rati Chaphekar)

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India Rupee - Asia FX: Mixed amid US-China tariff uncertainty, yuan dn 0.1%

 

MUMBAI – Asian currencies traded on a mixed note against the dollar Tuesday amid uncertainty related to US-China trade tensions. US President Donald Trump Friday announced an additional 100% tariff on China after Beijing expanded export controls on rare earths last week. The US will levy an extra 100% tariff on imports from China, along with export controls on "any and all critical software" from Nov. 1, Trump had said.

 

However, Trump's toned down comments against tariffs on China and a potential meeting with his Chinese counterpart Xi Jinping led to expectations of de-escalation in tensions between the two economic heavyweights. US Treasury Secretary Scott Bessent said Monday that Trump remains on track to meet Xi Jinping in South Korea later this month amid the ongoing trade uncertainties.

 

The dollar index surged last week due to continued uncertainty around the US government shutdown as Democrats and Republicans were unable to agree on a budget for the government's new fiscal year. The shutdown has continued for its third week, halting the release of key economic data, which is vital for investors to gauge the rate cut trajectory of the Federal Reserve. At 0840 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 99.27, against 99.25 Monday and 98.85 Friday. The Chinese yuan fell 0.1% against the dollar. 

 

The Indonesian rupiah rose 0.1% against the dollar after Finance Minister Purbaya Yudhi Sadewa Monday said they are considering injecting more liquidity into the country's state banks. However, he did not specify the amount, adding that the government was still reviewing the impact of a recent $12.08 billion injection of liquidity for state banks, which was given to boost lending as a way to stimulate economic growth.

 

The South Korean won fell 0.1%. The country's finance minister Monday said South Korea is discussing with the US various ways to set up a bilateral foreign exchange swap line as part of a trade deal over concerns about how proposed US investments could skew the local currency market. He said that the maximum amount of direct investment South Korea would be able to make in the US each year at around $20 billion, without depleting central bank reserves, compared with $350 billion agreed in the initial deal reached in July.

 

The Taiwan dollar, Philippine peso, and Thai baht rose 0.1?ch against the greenback whereas the Malaysian ringgit traded steady.  (Rati Chaphekar)

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India Rupee: Expected range for rupee - Oct 14

 

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

 

PARTICIPANT	SUPPORT	RESISTANCE
State-owned bank	88.80	88.50
Private-sector bank	88.85	88.60
Foreign bank	88.85	88.50
Brokerage firm	88.79	88.52
Brokerage firm	88.80	88.40

 

 

 

 

 

 

 

 

 

(Rati Chaphekar)

 

 

End

 

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

 

Edited by Saji George Titus

 

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