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Informist, Tuesday, Nov. 4, 2025

 

By Rati Chaphekar

 

The rupee ended off the day's high against the dollar as importers continuously bought the greenback, dealers said. However, the Indian currency was well supported by the Reserve Bank of India's active dollar sales throughout the day, they said.

 

The rupee surged unexpectedly at the open as the central bank heavily sold dollars in the offshore non-deliverable forwards market before the domestic spot market opened. "There is a pattern that can be seen now. RBI comes in aggressively after protecting a level for a few days, and then importers come," a dealer at a private-sector bank said. "This pattern will continue till the time there is no organic positive news flow for rupee."

 

After touching a high of 88.4100 a dollar, the rupee ended at 88.6550 Tuesday, against 88.7775 Monday. Most Asian currencies fell 0.1-0.6% against the dollar, with the South Korean won falling the most. The rupee was the second best performer among its peers after the Philippine peso.

 

The rupee opened 36 paise up from its previous close, thanks to the central bank's strong intervention in the NDF market minutes before the domestic spot market opened, dealers said. The central bank had intervened heavily in the offshore NDF market on Oct. 15 as well. Tuesday's aggressive intervention seemed like a repeat, according to dealers. 

 

"Since RBI had to make such a sharp move (in rupee), they intervened offshore (NDF)," a dealer at a state-owned bank said. "It is easier for RBI to make a sharp move offshore than in the spot. The amount of foreign exchange reserves required for the action is lower offshore."

 

The central bank's heavy intervention came after it had steadfastly intervened in the spot market the past few weeks to prevent the rupee from falling past the key level of 88.80 a dollar. The rupee had fallen to its lifetime low of 88.8025 a dollar on Sept. 30.

 

Shortly after opening, banks rushed to buy dollars for importers, who wanted to make the most of the jump in the rupee, which limited gains for the Indian unit, dealers said. However, public-sector banks sold dollars in the spot market as well, likely on behalf of the apex bank, which ensured the rupee did not depreciate, dealers said. 

 

Most currency dealers expressed displeasure over the the heavy-handedness of the RBI in preventing the rupee's depreciation. "The market has become highly predictable," a dealer at a private-sector bank said. "Every time the rupee is trading around 88.77 (a dollar), RBI drags it to 88.40-odd level. Importers then come in, which pressurises the rupee again, but not beyond 88.80 (a dollar)."

 

"The RBI should let go of the rupee now," a dealer at a state-owned bank said. "So much control over the market is not good in the long term. Traders will refrain from placing bets in the market."

 

Most market participants said the central bank is not letting the Indian unit depreciate ahead of the much-awaited trade deal between India and the US. After the deal, they expect the Indian currency to find its footing.

 

Meanwhile, the dollar index continued its rise, hitting an over-three-month high, which put the rupee under downward pressure, dealers said. The dollar index rose as comments by several US Federal Reserve officials dampened expectations of a rate cut by the central bank in December.

 

Fed Governor Lisa Cook Monday said elevated risks to both the central bank's employment and inflation mandates leave the December policy meeting "live" for a possible rate cut but not a lock. San Francisco Fed Chief Mary Daly said she viewed October's rate cut as further "insurance" against labour market weakening and has an "open mind" about the need for a similar move in December. 

 

At 1530 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 99.93, up from 99.72 Friday and 99.52 Thursday. The index rose to 100.05 earlier in the day, its highest level since Aug. 1.

 

The Indian unit was also weighed down by a fall in domestic equities, according to dealers. Tuesday, both the Nifty 50 and the BSE Sensex ended 0.6% lower.

 

	AT 1530 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	88.6550	88.4100	88.4100	88.6675	88.7775
1-year dlr/rupee fwd (paise)	191.67	194.00	194.33	190.83	192.97

 

FORWARDS

The one-year dollar-rupee forward premium ended at an over-10-week low Tuesday as the RBI likely sold dollars for long-tenure forward delivery to nullify the impact of its spot interventions on rupee liquidity, dealers said. The RBI likely sold forward dollars for maturity in December 2026 and January 2027, they said.

 

As spot dollar sales drain rupee liquidity from the banking system, the RBI conducts buy-sell swaps to replenish liquidity. A buy-sell swap entails buying dollars for immediate delivery and entering into a contract to sell these at a future date, thereby postponing the drain on systemic liquidity.

 

Meanwhile, some banks stepped in to buy dollars for forward delivery on behalf of importers, noting the sharp rise in the rupee, which limited losses for the premiums, dealers said. At 1530 IST, the one-year exact period dollar/rupee forward premium was 2.15%, against the previous close of 2.17%. On an absolute basis, the premium was 191.67 paise, against 192.97 paise Monday.

 

OUTLOOK

The currency market will remain closed Wednesday for Guru Nanak Jayanti. Thursday, the rupee will take cues from movement in the dollar index after the release of the US private payrolls data Wednesday, dealers said. With precious little economic data being reported in the US because of the continuing government shutdown, market participants will keep an eye on the private payrolls data for cues on the health of the world's largest economy.

 

Further, noting the RBI's strong defence of the rupee, traders expect the central bank to continue intervening through dollar sales to prevent the Indian currency hitting a record low. Market participants will also watch for any developments on the India-US trade negotiations.

 

"Even the trade deal between India and the US is more or less priced in the market now," a dealer at a state-owned bank said. "So, I cannot see why RBI is so rigid about holding the 88.80 (a dollar) level."

 

The rupee is expected to move in a range of 88.30 to 88.80 against the dollar Thursday. Immediate technical resistance for the rupee is pegged at 88.30 per dollar. 

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India Rupee - World FX: Australian dlr down after central bank keeps rates unch

 

	AT 1500 IST	HIGH	LOW	PREVIOUS
GBP/USD	1.3073	1.3148	1.3070	1.3138
EUR/USD	1.1511	1.1534	1.1499	1.1519
NZD/USD	0.5668	0.5709	0.5666	0.5703
AUD/USD	0.6504	0.6540	0.6501	0.6537
USD/JPY	153.5910	154.4800	153.3320	154.2050
USD/CAD	1.4066	1.4074	1.4054	1.4054
EUR/JPY	176.7950	177.7600	176.7860	177.6200
CHF/USD	1.2372	1.2397	1.2347	1.2373
EUR/CHF	0.9303	0.9318	0.9301	0.9307

 

MUMBAI – The Australian dollar fell 0.3% against the greenback even after Australia's central bank Tuesday left its cash rate steady as expected at 3.60%, saying it was cautious about further easing given the higher inflation, firm consumer demand and a revival in the housing market. The Reserve Bank of Australia said recent data suggested inflationary pressures could remain in the economy, adding that it would update its view as data evolves. The New Zealand dollar fell 0.3% against the dollar.

 

The Japanese yen rose 0.5% against the greenback after Japan's Finance Minister Satsuki Katayama reiterated Tuesday that the government would continue to monitor foreign exchange movements with a high sense of urgency as the yen hit fresh eight-month lows. "My stance remains completely unchanged at this point. Since we are seeing one-sided and rapid movements, just as I said at that time, we continue to monitor the situation with a high level of urgency," she said at a press conference.

 

Japanese Prime Minister Sanae Takaichi Tuesday said the country has yet to achieve sustainable inflation accompanied by wage gains, signalling her preference for the central bank to go slow in raising interest rates. While consumer inflation continues to hover around 3% due to rising food costs, Japan is still "half way" in achieving sustainable and stable price growth backed by solid wage gains, Takaichi told parliament.

 

Moreover, data Tuesday showed Japan's manufacturing activity shrank in October at the fastest pace in 19 months, hit by slumping demand in the key automotive and semiconductor sectors. The S&P Global Japan manufacturing purchasing managers' Index slipped to 48.2 in October from 48.5 in September, undershooting the flash reading of 49.3 and hitting the lowest level since March 2024.

 

The euro rose 0.1% against the greenback Tuesday after data Monday showed Eurozone manufacturing activity stagnated in October as new orders flatlined and headcount fell, despite production continuing to edge higher for the eighth consecutive month. The final HCOB Eurozone manufacturing purchasing managers' index, compiled by S&P Global, came in at 50.0 in October, matching a preliminary estimate and up slightly from September's 49.8 but right at the threshold separating growth from contraction.

 

The Swiss franc rose 0.1% against the dollar after Swiss National Bank's governing board member Petra Tschudin Tuesday said that the central bank is well positioned with its current interest rates. "We always use monetary policy in such a way that we can fulfil our mandate of ensuring price stability," Tschudin said, referring to the central bank's target range for inflation of 0-2%.

 

The pound sterling fell 0.2% against the greenback ahead of the outcome of the Bank of England's Monetary Policy Committee meeting, due Thursday. The central bank is expected to keep the key policy rate steady, slowing its pace of cuts for the first time since it started to loosen policy last year, although some analysts do expect a reduction after softer inflation and wage data. The Bank of England's most recent rate cut--by 25 basis points to 4% in August--was only passed by a 5-4 margin after two rounds of voting by the Monetary Policy Committee.

 

The dollar index hovered near its three-month high owing to fading expectations of another rate cut by Federal Reserve in December after comments by several Fed officials. At 1500 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 99.91, up from 99.88 Monday and 99.72 Friday. The index rose to 100.05 earlier in the day, highest since Aug. 1.  (Rati Chaphekar)

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India Rupee: 1-yr fwd premium hits 10-week low as RBI likely sells forward dlrs

 

	AT 1345 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	88.6400	88.4100	88.4100	88.6675	88.7775
1-year dlr/rupee fwd (paise)	191.67	194.00	194.33	190.83	192.97

 

NEW DELHI – The one-year dollar-rupee forward premium fell to an over-10-week low Tuesday as the Reserve Bank of India likely sold dollars for long-tenure forward delivery to neutralise its spot interventions and avert pushing out rupee liquidity, dealers said. The RBI likely sold forward dollars for maturity in December 2026, they said.

 

On Tuesday, the rupee surged against the dollar as the central bank heavily intervened through dollar sales in the offshore non-deliverable forwards market before spot market opening, dealers said. The RBI extended its intervention in the spot market as well, they said. "RBI is everywhere. Spot, forwards, NDF, everything is touched," a dealer at a state-owned bank said. "By the looks of it, this will not stop anytime soon."

 

Considering spot dollar sales push out rupee liquidity from the banking system, the RBI conducts buy-sell swaps to replenish liquidity. A buy-sell swap entails buying dollars for immediate delivery and entering into a contract to sell these at a future date, thereby postponing the drain on systemic liquidity. 

 

Meanwhile, some banks stepped in to buy dollars for forward delivery on behalf of importers, noting the sharp rise in the rupee, which limited losses for the premiums, dealers said. The rupee rose to a high of 88.4100 in early trade. 

 

At 1345 IST, the one-year exact period dollar/rupee forward premium was 2.15%, against the previous close of 2.17%. On an absolute basis, the premium was 191.67 paise, against 192.97 paise Monday.  (Pratiksha)

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India Rupee: Pares gains as importers buy dollars; RBI's dlr sales support

 

	AT 1305 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	88.6225	88.4100	88.4100	88.6550	88.7775

 

MUMBAI – The rupee gave up some of its early gains against the dollar as banks bought dollars on behalf of importers, who wanted to make the most of the relatively lower dollar/rupee levels, dealers said. However, some public sector banks sold dollars, likely on behalf of the Reserve Bank of India, which kept the domestic currency well supported, they said.

 

"I think 88.50-88.70 (a dollar) is the new trading range," a dealer at a private-sector bank said. "There was no particular reason for the RBI to intervene so much today (Tuesday), looks like they (RBI) don't want to take any risk of record low level."

 

The rupee surged early in the session as right before the domestic spot market opened, some state-owned banks sold dollars aggressively in the offshore non-deliverable forwards market, likely for the central bank, dealers said. As a result of this, the rupee started the day at 88.4100 a dollar, 36 paise above its previous close.

 

The RBI has continuously intervened in the spot market for the past few weeks, aggressively protecting the 88.80 a dollar level of the rupee. The rupee had fallen to its lifetime low 88.8025 a dollar level on Sept. 30.

 

For the rest of the day, the rupee is seen moving in a range of 88.30 and 88.70 against the greenback. Dealers peg immediate technical resistance for the rupee at 88.30.  (Rati Chaphekar)

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India Rupee: Technical levels for rupee - Nov 4

 

MUMBAI – At 1050 IST, the rupee was at 88.5825 per dollar. At 0900 IST, the rupee was at 88.4100 a dollar, against the previous close of 88.7775 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
State-owned bank	89.20	88.85	88.40	88.35
Private-sector bank	89.25	88.90	88.30	88.25
Brokerage firm	89.00	88.80	88.30	87.50

 

(Rati Chaphekar)

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India Rupee: Sharply up as RBI heavily sells dollars in offshore NDF market

 

	AT 0925 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	88.5100	88.4100	88.4100	88.5425	88.7775

 

MUMBAI – The rupee surged against the dollar Tuesday as state-owned banks sold dollars in the offshore non-deliverable forwards market, likely on behalf of the Reserve Bank of India, right before the domestic spot market opened, dealers said. "It was highly unexpected," a dealer at a private sector bank said. "Rupee was steady in offshore until 0855 IST, but suddenly bulk selling (of dollars) came in from nationalised banks."

 

Dealers said the central bank intervened heavily in the offshore NDF market to shore up the Indian currency. The central bank had intervened heavily in the offshore NDF market on Oct. 15 as well. Tuesday's aggressive intervention seemed like a repeat of that, according to dealers. 

 

The RBI has continuously intervened in the spot market for the past few weeks, aggressively protecting the 88.80 a dollar level of the rupee. The rupee had fallen to its lifetime low 88.8025 a dollar level on Sept. 30.

 

Meanwhile, the dollar index continued its upward trend, hitting an over three-month high, which put the rupee under downward pressure. The dollar index rose as comments by several Federeal Reserve officials dampened expectations of a rate cut by the central bank in December. At 0925 IST, the dollar index, which measures the strength in the dollar against a basket of six major currencies, was at 99.77, up from 99.72 Friday and 99.52 Thursday. 

 

For the rest of the day, the rupee is seen moving in a range of 88.20 and 88.70 against the greenback. Dealers peg immediate technical resistance for the rupee at 88.30.  (Rati Chaphekar)

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India Rupee - Asia FX: Most down; dlr index up as hopes of Dec rate cut fade

 

MUMBAI – Most Asian currencies fell against the dollar Tuesday as the dollar index rose to a fresh over three-month high owing to fading expectations of another rate cut by Federal Reserve in December after comments by some more Fed officials late Monday. 

 

Fed Governor Lisa Cook said elevated risks to both the central bank's employment and inflation mandates leave the December policy meeting "live" for a possible rate cut, but not a lock. San Francisco Fed Chief Mary Daly said she viewed October's rate cut as further "insurance" against labour market weakening and has an "open mind" about the need for a similar move in December.

 

After the Fed's decision to opt for a 25-basis-point rate cut in October, several other Fed officials, including Fed Chair Jerome Powell, have made comments on similar lines. Fed fund futures traders are now pricing in a 65.3% chance of a 25-basis-point cut at the December meeting, according to CME's FedWatch Tool. At 0905 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 99.97, up from 99.88 Monday and 99.72 Friday.

 

The Taiwan dollar, Malaysian ringgit, and Thai baht fell 0.2% against the greenback. The Chinese yuan fell 0.1% against the dollar. The South Korean won fell 0.6% against the greenback, the most among its peers, even after data Tuesday showed South Korea's consumer prices rose at the fastest pace in more than a year in October, bolstering the case for policymakers to refrain from cutting interest rates further. The consumer price index rose 2.4% in October from a year earlier, the fastest pace since July last year, and after rising 2.1% in September. A Reuters poll showed analysts had expected headline inflation at 2.1% in October.

 

Moreover, South Korean President Lee Jae Myung Tuesday said that the economy had turned a corner as risks related to geopolitics and corporate governance had been easing, which boosted the local Kospi stock index beyond the 4,000 mark. "Consumer sentiment is improving, and economic growth in the third quarter has rebounded to a six-quarter high of 1.2% from a contraction in the first quarter," Lee said in his annual budget speech at the National Assembly.

 

The Indonesian rupiah fell 0.3% against the dollar after data released late Monday showed Indonesia recorded a trade surplus of $4.34 billion in September, lower than the $4.79 billion forecast by economists in a Reuters poll, as both exports and imports came in above market expectations. Bucking the trend, the Philippine peso rose 0.1% against the dollar.  (Rati Chaphekar) 

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India Rupee: Expected range for rupee - Nov 4

 

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	88.85	88.60
State-owned bank	88.81	88.72
State-owned bank	88.90	88.50
Private-sector bank	88.90	88.60
Private-sector bank	88.80	88.75
Brokerage firm	88.85	88.65
Brokerage firm	88.90	88.60

 

 

 

 

 

 

 

 

 

 

 

(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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