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Informist, Tuesday, Oct. 7, 2025

 

By Rati Chaphekar and Pratiksha

 

MUMBAI – After trading in a tight range throughout the day, the rupee ended steady against the dollar Tuesday as the impact of foreign inflows for investment into initial public offerings of domestic companies was neutralised by dollar purchases on behalf of importers, dealers said. The Indian unit was also supported by likely dollar sales on behalf of the Reserve Bank of India in the last leg of trade, they said. 

"There were finally inflows in the market but demand (for dollars) was high enough to absorb the flows," a dealer at a private-sector bank said. After trading in a thin band of eight paise during the day, the rupee settled at 88.7725 a dollar, against 88.7800 on Monday.  

 

The rupee started the day slightly higher against the dollar as the RBI likely sold dollars in the offshore non-deliverable forwards market before the spot market opened, as has been the trend for the past few weeks. The central bank has actively intervened in the domestic spot and offshore NDF market for the last few weeks to prevent the rupee from falling below 88.80 a dollar. 

 

However, banks stepped in to buy dollars on behalf of importers, who feared further depreciation in the Indian unit, which weighed on the rupee, dealers said. The domestic currency has been under 

depreciation pressure amidst uncertainty around the India-US trade deal, owing to which it touched lifetime low of 88.8025 a dollar last week. 

 

Further, banks sold dollars for overseas investment into the IPOs of domestic companies, which pushed the Indian unit to the day's high of 88.7150 a dollar, dealers said. Public offers of multiple domestic companies are lined up this week. Tata Capital's IPO opened Monday and will close on Wednesday while LG Electronics India Ltd.'s public offer opened for subscription Tuesday and will close on Thursday. Public offer of Canara HSBC Life Insurance Co. Ltd. will open on Friday and close on Oct. 14, with anchor investment bidding on Thursday.  

 

Meanwhile, the dollar index edged higher in European trade tracking sharp losses in the euro and yen, which also exerted downward pressure on the Indian unit, and pushed it to the day's low of 88.7900 a dollar, just shy of its lifetime low, dealers said. At 1530 IST, the dollar index, which measures the strength in the dollar against a basket of six major currencies, was at 98.46, against 98.12 Monday and 97.71 Friday. 

 

However, the RBI likely stepped in to sell dollars in domestic spot market in the last leg of the trade, which prevented the rupee from hitting a record low, dealers said. "It looks like RBI came in the end just to protect that 88.80 (a dollar) level," a dealer at a state-owned bank said. "I don't think they are willing to let 89.00 happen very easily." 

 

A rise in domestic equities also supported the Indian unit, dealers said. Tuesday, the Nifty 50 ended 0.1% higher and the Sensex ended 0.2% higher.

 

 

 

	AT 1530 IST	AT 0900 IST	HIGH	LOW	PREVIOUS(AT 1530 IST)
Spot rupee per $1	88.7725	88.7200	88.7150	88.7900	88.7800
1-year dlr/rupee fwd (paise)	196.95	200.50	201.75	196.88	202.90

 

FORWARDS

Dollar/rupee forward premiums ended lower across tenures Tuesday, with the one-year forward premium settling at an over one-month low, as the RBI likely sold dollars for one- to three-month forward delivery, in order to nullify its spot interventions and avoid draining rupee liquidity, dealers said.

 

Since spot dollar sales push out rupee liquidity from the banking system, the central bank 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. 

 

At 1530 IST, the one-month exact period dollar/rupee forward premium was 1.78%, against the previous close of 1.82%. On an absolute basis, the premium was 13.84 paise, against 14.63 paise Monday. At 1530 IST, the one-year exact period dollar/rupee forward premium was 2.22%, against the previous close of 2.29%. On an absolute basis, the premium was 196.95 paise, against 202.90 paise Monday. 

 

OUTLOOK

On Wednesday, the rupee will take cues from the movement in the dollar index and other Asian currencies, dealers said. Market participants will continue to closely monitor developments related to India-US trade talks. 

 

They will watch out for the central bank's intervention in the currency market, expecting it to continue intervening through dollar sales and preventing the rupee from testing the psychologically crucial level of 89.00 a dollar.

 

The Indian currency may also receive support from foreign inflows into the initial public offerings of domestic companies, dealers said. "People are waiting for more FPI flows to come considering the IPOs this month" a dealer at a state-owned bank said. "Even if the rupee depreciates, it (the rupee) will not go beyond 88.90 in near future."

 

Importers may also continue buying dollars, wary of a further decline in the rupee, exerting downward pressure on the local unit, they said. "The rupee continues to hover near lower zones, keeping concerns of further weakness alive, possibly toward 90 (a dollar) levels if sentiment worsens," Jateen Trivedi, VP research analyst - commodity and currency at LKP Securities said in a note.

 

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, a break of which can push the rupee to 89.00, they said.

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India Rupee - World FX: Yen, euro fall for second day; dollar index rises

 

	AT 1515 IST	HIGH	LOW	PREVIOUS
GBP/USD	1.3436	1.3487	1.3429	1.3480
EUR/USD	1.1662	1.1715	1.1661	1.1706
NZD/USD	0.5810	0.5842	0.5805	0.5837
AUD/USD	0.6592	0.6624	0.6586	0.6611
USD/JPY	150.7450	150.8300	150.2500	150.2770
USD/CAD	1.3956	1.3962	1.3943	1.3941
EUR/JPY	175.8080	176.3420	175.6700	175.8590
CHF/USD	1.2530	1.2582	1.2527	1.2567
EUR/CHF	0.9307	0.9321	0.9304	0.9301

 

India Rupee - World FX: Yen, euro fall for second day; dollar index rises

 

MUMBAI – The Japanese yen continued to weaken for the second day against the greenback, falling 0.2%, after Japan's ruling Liberal Democratic Party elected a new leader. On Saturday, Sanae Takaichi was elected leader of the ruling party and is now on course to become Japan's first female prime minister. Her expansionist economic policy has led to traders reducing bets that the central bank will hike interest rates this month.

 

Japanese Finance Minister Katsunobu Kato Tuesday said that the government will be vigilant for volatile movement on the currency market, as the yen slid to two-month lows past 150 to the dollar amid rising fiscal concerns. "It's important for currencies to move in a stable manner reflecting fundamentals," Kato said. Meanwhile, data Tuesday showed consumer spending in Japan rose 2.3% on year, up for the fourth consecutive month and well above the median market forecast of a 1.2% rise. 

 

The euro also extended its Monday's fall, down 0.3% against the dollar after the unexpected resignation of France Prime Minister Sebastien Lecornu on Monday marked another major deepening of France's political crisis. The resignation came just hours after he announced part of his new Cabinet. 

 

The dollar index edged higher in European trade tracking losses in the euro and yen. At 1515 IST, the dollar index, which measures the strength in the dollar against a basket of six major currencies, was at 98.46, against 98.12 Monday and 97.71 Friday. The index rose to a high of 98.50 on Monday. The pound sterling and Swiss franc fell 0.3% against the greenback. 

 

The Australian dollar fell 0.4% against the greenback after data Tuesday showed Australia's Westpac Consumer Confidence declined 3.5% to 92.1 in October from 95.4 in September. The drop was the biggest since April. The New Zealand dollar fell 0.6% against the greenback.  (Rati Chaphekar)

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India Rupee: In thin band; IPO-linked FX inflows offset importers' dlr buys

 

	AT 1325 IST	AT 0900 IST	HIGH	LOW	PREVIOUS(AT 1530 IST)
Spot rupee per $1	88.7400	88.7200	88.7150	88.7650	88.7800

 

India Rupee: In thin band; IPO-linked FX inflows offset importers' dlr buys

 

MUMBAI – The rupee traded in a thin band against the dollar as banks sold dollars for overseas investment into the initial public offerings of domestic companies, which offset the impact of dollar purchases by importers, dealers said. The Indian unit has moved in a range of just five paise so far Tuesday. 

 

"IPO-related inflows are present in the market today (Tuesday)," a dealer at a private sector bank said. "I think these flows should continue for a while as some major IPOs are due this month." The Indian unit rose to 88.7150 earlier in the day. 

 

Public offers of multiple domestic companies are lined up this week. Tata Capital's IPO opened Monday and will close on Wednesday while LG Electronics India Ltd.'s public offer opened for subscription Tuesday and will close on Thursday. Public offer of Canara HSBC Life Insurance Co. Ltd. will open on Friday and close on Oct. 14, with anchor investment bidding on Thursday.

 

However, banks persistently bought dollars on behalf of importers, who are wary of depreciation in the rupee going ahead, which weighed on the Indian unit, dealers said. The rupee has been trading with a weakening bias, hitting a record low of 88.8025 a dollar last week, amid the ongoing uncertainty around a trade deal between India and the US, with US President Donald Trump's sweeping tariffs on New Delhi. 

 

Earlier in the day, the Reserve Bank of India likely sold dollars in the offshore non-deliverable forwards market before the domestic spot market opened, which provided some support to the Indian currency. For the rest of the day, the rupee is seen moving in a range of 88.60 and 88.80 against the greenback. Dealers peg immediate technical support for the rupee at 88.80 and resistance at 88.50. (Rati Chaphekar)

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India Rupee: Premiums drop across tenures as RBI likely sells forward dlrs

 

	AT 1235 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	88.7500	88.7200	88.7150	88.7650	88.7800
1-year dlr/rupee fwd (paise)	197.60	200.50	201.75	197.45	202.90

 

India Rupee: Premiums drop across tenures as RBI likely sells forward dlrs 

NEW DELHI – Dollar/rupee forward premiums fell across tenures Tuesday, with the one-year forward premium hitting an over one-month low, as the Reserve Bank of India likely sold dollars for one- to three-month forward delivery, in order to nullify its spot interventions and avoid draining rupee liquidity, dealers said.

 

In the last few weeks, the central bank has been actively selling dollars in the domestic spot market to prevent sharp depreciation in the Indian unit. Since spot dollar sales push out rupee liquidity from the banking system, the central bank 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. 

 

"RBI seems to be recieving in the October to January tenures. If they continue intervening heavily in spot, they will have to offset it somewhere. I am sure they will try to avoid any liquidity mess," a dealer at a private sector bank said. 

 

The rupee has been on a depreciation spree amid the ongoing uncertainty around an India-US trade deal, with US President Donald Trump's sweeping tariffs on New Delhi. Last month, the rupee depreciated 0.7% against the dollar, hitting a record low of 88.8025 a dollar.

 

At 1235 IST, the one-month exact period dollar/rupee forward premium was 1.76%, against the previous close of 1.82%. On an absolute basis, the premium was 13.68 paise, against 14.63 paise Monday. At 1235 IST, the one-year exact period dollar/rupee forward premium was 2.23%, against the previous close of 2.29%. On an absolute basis, the premium was 197.60 paise, against 202.90 paise Monday.  (Pratiksha)

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India Rupee: Technical levels for rupee - Oct 7

 

MUMBAI – At 1055 IST, the rupee was at 88.7600 per dollar. At 0900 IST, the rupee was at 88.7200 a dollar, against the previous close of 88.7800 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	88.90	88.85	88.65	88.55
Private-sector bank	89.00	88.80	88.50	88.20
Brokerage firm	89.00	88.80	88.40	88.20
Brokerage firm	89.20	89.00	88.50	88.40

 

(Rati Chaphekar)

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India Rupee: Steady as RBI's likely dlr sales in NDF offset importers' buys

 

	AT 0950 IST	AT 0900 IST	HIGH	LOW	PREVIOUS(AT 1530 IST)
Spot rupee per $1	88.7500	88.7200	88.7175	88.7650	88.7800

 

India Rupee: Steady as RBI's likely dlr sales in NDF offset importers' buys

 

MUMBAI – The rupee was largely steady against the dollar Tuesday as the Reserve Bank of India's likely dollar sales in the offshore non-deliverable forwards market offset the impact of dollar purchases by importers, dealers said. "Rupee movement is same as yesterday (Monday). Dollar sales in NDF have pushed the rupee (higher)," a dealer at a state-owned bank said. 

 

The RBI likely intervened through dollar sales in the offshore NDF market, as has been the case in the last few weeks, to prevent the rupee from hitting a record low, according to dealers. The rupee hit a record low of 88.8025 a dollar last week. Dealers expect the RBI to intervene in the spot market as well around 88.80 a dollar, going by the trend in recent days.  

 

The dollar index rose sharply Monday as the euro and yen declined sharply owing to fiscal and political stability concerns after Japan's ruling party elected a new leader and France's new government quit. However, it gave up some of its intraday gains and was broadly steady, which also supported the Indian unit, dealers said. At 0950 IST, the dollar index, which measures the strength in the dollar against a basket of six major currencies, was at 98.14, against 98.12 Monday and 97.71 Friday. The index rose to a high of 98.50 on Monday. 

 

Meanwhile, banks bought dollars for importers, who wanted to make the most of the current dollar/rupee levels, wary of depreciation in the Indian unit, dealers said. The rupee opened slightly higher at 88.7200 on Tuesday, against the previous close of 88.7800.  

 

Foreign inflows into initial public offerings of domestic companies may also support the domestic currency during the day, according to dealers. Tata Capital's IPO opened Monday and will close on Wednesday. LG Electronics India Ltd.'s public offer opened for subscription Tuesday and will close on Thursday. 

 

"While inflows may help the rupee slightly, a clearer trend reversal could be sparked by positive developments in US-India trade negotiations — something that may finally nudge the rupee out of its sluggish zone," Amit Pabari, managing director at CR Forex, said in a note. 

 

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 shutdown uncertainty; Thai baht dn 0.3%

 

MUMBAI – Asian currencies traded on a mixed note against the dollar Tuesday as market participants assess the impact of the US government shutdown that started last week, with Democrats and Republicans unable to agree on a budget for the government's new fiscal year. The shutdown delayed last Friday's closely watched monthly jobs report for September, and is set to postpone other key releases until the government reopens.

 

The White House on Monday backed off US President Donald Trump's statement that government employees were already being laid off due to the shutdown, but warned of job losses as the standoff looked set to stretch into a seventh day.

 

At 0900 IST, the dollar index, which measures the strength in the dollar against a basket of six major currencies, was at 98.16, against 98.12 Monday and 97.71 Friday. The dollar index rose to a high of 98.50 Monday but erased some of its gains in early trade Tuesday. 

 

The Thai baht fell 0.3% against the dollar Tuesday ahead of Bank of Thailand's monetary policy meeting on Wednesday. Thailand's central bank is expected to cut the key policy rate by 25 basis points to support a slowing economy. Currently, Bank of Thailand's key policy rate stands at 1.50%. 

 

The Philippine peso rose 0.2% against the greenback after data on Tuesday showed annual inflation was 1.7% in September, above the previous month's 1.5% rate. Economists in a Reuters poll had expected annual inflation to pick up to 2.0% in September.

 

The Taiwan dollar rose 0.5% against the greenback, while the South Korean won fell 0.1%. The Chinese yuan, Malaysian ringgit and Indonesian rupiah traded steady against the dollar.  (Rati Chaphekar)

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India Rupee: Expected range for rupee - Oct 7

 

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	88.58
State-owned bank	88.80	88.65
Foreign bank	88.90	88.60
Brokerage firm	88.90	88.50
Brokerage firm	88.82	88.62

 

 

 

 

 

 

 

 

(Rati Chaphekar)

 

End

 

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

 

Edited by Vandana Hingorani 

 

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