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Informist, Friday, Oct. 17, 2025

India Rupee - World FX: Yen up on BoJ rate hike bets, fall in dollar index

MUMBAI – The Japanese yen rose 0.5% against the greenback after Bank of Japan's Deputy Governor Shinichi Uchida Friday said the bank will continue to raise interest rates if economic and price developments move in line with its forecasts. Additionally, Bank of Japan Governor Kazuo Ueda late Thursday said the central bank will scrutinise various data, including information he collects during his stay in Washington, DC, to decide whether to raise interest rates this month. He repeated his view that the central bank will hike rates if the likelihood of its growth and price forecasts materializing increases.

Japan's two biggest political parties, the Liberal Democratic Party and Constitutional Democratic Party, reached a broad agreement to hold a parliamentary vote to select the next prime minister on Oct. 21, as per media reports.

The dollar index fell further Friday amid US-China trade tensions and as market participants assessed remarks by US Federal Reserve officials. Fed Governor Christopher Waller said he was on board with another interest rate cut at the US central bank's meeting later this month because of mixed readings on the state of the job market. Stephen Miran, the Fed's newest governor and an economic adviser to President Donald Trump, reiterated support for more aggressive rate cuts at upcoming meetings than those favoured by some of his colleagues.

An extended shutdown of the US government has blocked the publication of key economic data, which is also weighing on the US currency. The weekly labour data for the US was not announced for the second consecutive time. The data are important for investors to gauge the Fed's rate-cut trajectory. Fed funds futures traders now see a 96.8% probability of the US central bank lowering interest rates by 25 basis points this month, according to the CME FedWatch tool. At 1440 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 98.26, against 98.34 Thursday and 98.67 Wednesday.

The euro fell 0.2% against the greenback while the pound sterling remained steady. The UK's labour market is weakening but not at so sharp a rate that it requires the Bank of England to cut interest rates further, central bank policymaker Catherine Mann said Thursday. "What has transpired is that the labour market has modestly loosened, but it is not falling off of the cliff," Mann said.

The Australian dollar and the New Zealand dollar fell 0.3% and 0.1%, respectively, amid escalating US-China trade tensions.  (Rati Chaphekar)

India Rupee: Falls as importers buy dollars; RBI's intervention prevents 88/$1

MUMBAI – The rupee fell against the dollar, erasing early gains, as banks bought dollars for importers, in order to make the most of the relatively lower dollar/rupee levels, dealers said. However, losses in the Indian unit were limited as some public sector banks sold dollars, likely on behalf of the Reserve Bank of India, they said. 

"We saw some (RBI) intervention around 87.92, a similar level as yesterday (Thursday)," a dealer at a state-owned bank said. "However, the intervention was not aggressive in nature. That is why we didn't see much appreciation (in rupee)."

Dealers said the central bank likely intervened to prevent the Indian unit from falling past the 88-a-dollar mark, just like Thursday. The push to keep the Indian unit above the 88-per-dollar mark comes after the RBI intervened heavily in the currency market on Wednesday, which led to the Indian unit logging its biggest intraday gain since November 2022. Earlier in the day, some banks sold dollars in the offshore non-deliverable forward market, likely on behalf of the apex bank, which helped the Indian currency open slightly higher in the spot market, dealers said.

The rupee came under downward pressure as investors' risk sentiment dampened after hopes of a trade deal between India and the US in the near term were quashed. This came after India's foreign ministry rejected Trump's claim that Prime Minister Narendra Modi had agreed to stop buying Russian oil.

The dollar index fell Friday amid US-China tensions and as market participants assessed remarks by Federal Reserve officials, which offered some support to the Indian unit, dealers said. At 1315 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 98.17, against 98.34 Thursday and 98.67 Wednesday.

For the rest of the day, the rupee is seen moving in a range of 87.50 and 88.00 against the greenback. Dealers peg immediate technical resistance for the rupee at 87.60.  (Rati Chaphekar)

India Rupee: Forward premium rises as US yields fall on Fed rate cut bets

NEW DELHI – The one-year dollar/rupee forward premium rose as the 10-year US Treasury yield fell below the 4.00% mark after comments by Federal Reserve officials boosted expectations of a rate cut this month, dealers said. Forwards of a currency pair are reflective of the interest rate differential between the two countries. 

"We're seeing paying tracking the US yields. There has been a consistent decline in US yields so some impact will be seen," a dealer at a private-sector bank said. "But since we have been seeing recieving as well, (forward premium) levels should be in check."

On Thursday, Fed Governor Christopher Waller said he was on board with another interest rate cut at the US central bank's meeting later this month because of mixed readings on the state of the jobs market. Stephen Miran, the Fed's newest governor and an economic adviser to Trump, reiterated support for more aggressive rate cuts at upcoming meetings than those favoured by some of his colleagues.

Fed funds futures traders now see a 94.7% probability of the US central bank lowering interest rates by 25 basis points this month while seeing a 5.3% chance of a jumbo 50 bps rate cut, according to the CME FedWatch tool. The 10-year US bond yield fell to 3.99% Thursday from 4.05% Wednesday. 

With the US government shutdown now in its third week, investors are keeping a close watch on the speeches of Fed officials for more cues on the future path of US interest rates. The shutdown has led to no release of official economic data.

At 1320 IST, the one-year exact period dollar/rupee forward premium was 2.29%, against the previous close of 2.24%. On an absolute basis, the premium was 201.11 paise, against 196.33 paise Thursday.  (Pratiksha)

India Rupee: Technical levels for rupee - Oct 17

MUMBAI – At 1135 IST, the rupee was at 87.9050 per dollar. At 0900 IST, the rupee was at 87.7600 a dollar, against the previous close of 87.8200 a dollar. Following are the key support and resistance levels for the rupee as provided by leading banks and brokerages:

(Rati Chaphekar)

India Rupee: Steady; RBI's likely dollar sales in offshore NDF mkt support

MUMBAI – The rupee was largely steady against the dollar Friday as the impact of dampened risk sentiment after India denied US President Donald Trump's claim that Prime Minister Narendra Modi had agreed to stop buying Russian oil, was nullified by the Reserve Bank of India's likely dollar sales in the offshore non-deliverable forwards market, dealers said.

"Looks like the central bank wants to protect the 88-a-dollar level now," a dealer at a private-sector bank said. "Maybe they are worried that Diwali rush and month-end payments may drag the rupee to 89.00 (a dollar)."

Before the domestic spot market opened, the Indian unit was trading around 88.04 a dollar in the offshore NDF market. However, it opened at 87.7600 a dollar in the spot market, thanks to the RBI's intervention.

"The central bank intervened heavily on Wednesday. If they don't protect 88.00 (a dollar) now, the rupee will slowly inch back to 88.80 where it was earlier, so (RBI) intervention will not be useful," a dealer at a state-owned bank said. "They are waiting for update on tariffs, after that intervention will not be necessary."

Hopes of a trade deal between India and the US in the near term were dented after India's foreign ministry rejected Trump's claims. On Wednesday, Trump had said Modi had assured him that India would not buy oil from Russia. 

Further, some banks stepped in to buy dollars on behalf of importers, noting the relatively lower dollar/rupee levels, which also weighed on the Indian unit, dealers said. The Indian currency touched a high of 87.7300 after opening. 

The dollar index fell further Friday amid US-China tensions and as market participants assessed remarks by Federal Reserve officials, which offered some support to the Indian unit, dealers said. At 0945 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 98.18, against 98.34 Thursday and 98.67 Wednesday.

For the rest of the day, the rupee is seen moving in a range of 87.50 and 88.00 against the greenback. Dealers peg immediate technical resistance for the rupee at 87.60.  (Rati Chaphekar)

India Rupee - Asia FX: Mixed amid US-China trade tension, S Korean won falls

MUMBAI – Asian currencies traded on a mixed note against the dollar Friday as market participants remained wary of US-China trade tensions. China on Thursday defended its ongoing purchases of Russian oil. The country's Ministry of Commerce accused the US of creating "panic" over Beijing's controls on rare earth exports, but indicated it was open to trade talks to resolve the dispute. 

US Trade Representative Jamieson Greer and Treasury Secretary Scott Bessent Thursday blasted China's major expansion of rare earth export controls as a threat to global supply chains, but said Beijing could still change course and avoid steps by Washington to decouple from the world's second-largest economy. The Chinese yuan traded steady against the greenback, while the Taiwan dollar fell 0.1%.

The dollar index fell further Friday amid US-China tensions and as market participants assessed remarks by Federal Reserve officials. Fed Governor Christopher Waller said he was on board with another interest rate cut at the US central bank's meeting later this month because of mixed readings on the state of the job market. Stephen Miran, the Fed's newest governor and an economic advisor to Trump, reiterated support for more aggressive rate cuts at upcoming meetings than that favoured by some of his colleagues.

Fed funds futures traders now see a 96.8% probability of the US central bank lowering interest rates by 25 basis points this month, according to the CME FedWatch tool. At 0920 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 98.19, against 98.34 Thursday and 98.67 Wednesday.

Tracking the fall in the dollar index, the Philippine peso and the Malaysian ringgit rose 0.1% against the dollar. The Thai baht fell 0.2% against the greenback, whereas the Indonesian rupiah traded steady. 

The South Korean won fell 0.3% against the greenback. South Korea's national security adviser Thursday said US President Donald Trump would visit South Korea on Oct. 29 and is expected to stay until Oct. 30. South Korea will host a summit of the Asia-Pacific Economic Cooperation forum, which the US is part of, starting on Oct. 31.  (Rati Chaphekar)

India Rupee: Expected range for rupee - Oct 17

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

(Rati Chaphekar)

End

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

Edited by Rajeev Pai

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