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Informist, Monday, Oct. 13, 2025

By Rati Chaphekar and Pratiksha

MUMBAI – The rupee gave up gains and ended steady against the dollar Monday as importers rushed to buy the greenback to make the most of the relatively lower dollar/rupee levels, dealers said. The Indian unit got a boost after media reports increased hopes of progress in the India-US trade deal negotiations. The Indian unit was also supported by the Reserve Bank of India's likely dollar sales earlier in the day, they said.

"The trade deal news was the main factor for rupee's appreciation. A lot of longs (dollar bets) got unwound after that," a dealer at a state-owned bank said. After touching a high of 88.5700 a dollar during the day, the rupee ended at 88.6700 Monday against 88.6850 Friday. The Indian unit traded in a range of 22 paise during the day.  

The Indian unit started the day slightly lower against the dollar as investors' risk appetite took a beating after renewed US-China trade tensions, dealers said. US President Donald Trump Friday announced an additional 100% tariff on China after Beijing expanded export controls on rare earth minerals 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 or sooner, he said. 

However, Trump's post on Truth Social suggested the US might not follow through on the threat to impose a massive increase of tariff on China. "Don't worry about China, it will all be fine! Highly respected President Xi just had a bad moment. He doesn't want Depression for his country, and neither do I," Trump wrote.

However, shortly after the market opened, state-owned banks sold dollars, likely on behalf of the central bank, which prevented the Indian unit from hitting a record low. The Indian unit touched a low of 88.7925 a dollar during the day, just shy of its lifetime low of 88.8025. In the past few weeks, the RBI has actively intervened in the currency market to protect 88.80 a dollar. "There is no reason for the RBI to protect these levels really. Why now? Nobody knows," a dealer at a private sector bank said. 

However, during the second half of the trading day, the Indian currency changed its course and gave up all of its losses as traders grew hopeful of progress in the India-US trade negotiations after media reports said Indian teams are leaving for the US for the next round of trade talks this week.

Both New Delhi and Washington are hopeful of closing the first tranche of the trade deal by the end of the fall season, reports said. Negotiations on the proposed bilateral trade agreement are progressing well, a top official said on Monday. "The positive sentiment around the trade news helped rupee recover," a dealer at another private sector bank said. "If not for that, it was hovering around its usual level of 88.80 a dollar, controlled by selling (of dollars) by nationalised banks." 

Following the news, multiple stop-losses were triggered on long dollar bets, which pushed the Indian unit to the day's high. The US has slapped an additional 25% punitive tariff on Indian goods, on top of a 25% reciprocal tariff, citing New Delhi's continued purchases of Russian crude oil.

However, the rupee could not hold on to its gains for too long as banks stepped in to buy dollars for importers, who wanted to make the most of  the relatively lower dollar/rupee level, dealers said. "Importers have been profit booking whenever there is any major fluctuation in levels. It makes sense also," a dealer at a foreign bank said. "All the other buying (of dollars) we are seeing is from speculators." 

The dollar index had fallen sharply Friday after Trump's announcement of steep tariffs on China. However, the index gave up losses and edged higher in European trade as investors grew hopeful of de-escalation in trade tensions between China and the US, which also weighed on the rupee, dealers said. At 1530 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 99.10, against 98.85 Friday and 99.40 Thursday.

FORWARDS

The one-year dollar/rupee forward premium ended largely steady as the impact of a sharp fall in US Treasury yields was offset by the RBI's likely forward dollar sales for near-term delivery, dealers said. The RBI likely sold forward dollars for maturity in December and January, they said.

Since spot dollar sales drain 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, US Treasury yields slumped Friday as investors flocked to safe-haven assets after President Donald Trump's threat to impose 100% tariffs on Chinese imports. The 10-year US Treasury yield declined to 4.05% Friday against 4.14% Thursday. Forwards of a currency pair are reflective of the interest rate differential between the two countries.

At 1530 IST, the one-year exact period dollar/rupee forward premium was 2.22%, unchanged from the previous close. On an absolute basis, the premium was 197.00 paise, against 196.57 paise Friday.

OUTLOOK

On Tuesday, the rupee will take cues from movement in the dollar index and other Asian currencies, 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. "After today's (Monday) news (on Inda-US trade deal), everyone is now again hopeful of a good trade deal. We expect at least the additional 25% US tariff to be removed," a dealer at a state-owned bank said. Market players will also watch out for developments related to US-China trade tensions. 

Dealers also expect importers to continue buying dollars, wary of the rupee declining going ahead, which would exert pressure on the local unit. However, the Indian unit may likely recieve support from foreign inflows linked to IPOs of domestic companies, dealers said. The public offer of Canara HSBC Life Insurance Co. Ltd. opened on Friday and will close on Tuesday.

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.

India Rupee: Up; erases losses amid hopes of progress in India-US trade deal

MUMBAI – The rupee rose slightly against the dollar, erasing all its earlier losses, owing to hopes of some progress in the India-US trade deal after media reports said Indian teams are leaving for the US for the next round of trade talks this week, dealers said. New Delhi and Washington are hopeful of closing the first tranche of the trade deal by the end of the fall season, reports said.   

"There seems to be some good progress happening on the trade deal front. The market sold off (dollars) after that news," a dealer at a state-owned bank said. The rupee had hit a low of 88.7925 a dollar earlier in the day. 

Following the news, multiple stop-losses were triggered on long dollar bets, which pushed the rupee to a high of 88.5700 a dollar, dealers said. The US has slapped an additional 25% punitive tariff on Indian goods, on top of a 25% reciprocal tariff, citing New Delhi's continued purchases of Russian crude oil.

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 resistance for the rupee at 88.50. (Rati Chaphekar and Pratiksha) 

India Rupee: Remains down on US-China trade tensions; RBI averts record low

India Rupee: Remains down on US-China trade tensions; RBI averts record low

MUMBAI – The rupee fell against the dollar, hovering near its record low, Monday as risk appetite among investors was hit after revival of US-China trade tensions, dealers said. However, some public sector banks sold dollars likely on behalf of the Reserve Bank of India, which prevented sharp losses in the Indian unit, they said. The Indian unit has moved in a range of just 8 paise so far on Monday.

"The recent news about Washington's tariffs on China has scared the market a bit," a dealer at a private-sector bank said. "Moreover, no positive news on the India-US tariff front has added to the panic." US President Donald Trump Friday announced an additional 100% tariff on China after Beijing expanded export controls on rare earth minerals 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 or sooner, Trump said. 

The central bank likely sold dollars to prevent the Indian unit from hitting a record low, dealers said. The Indian unit touched a low of 88.7925 a dollar during the day, just shy of its lifetime low of 88.8025. In the past few weeks, the RBI has actively intervened in the currency market to protect 88.80 a dollar.

"I think the 88.80 a dollar will break this week, importers' demand (for dollars) has increased a lot," a dealer at a state-owned bank said. "But not today (Monday) as we have seen a lot of selling (of dollars) by the nationalized banks already. Maybe it will break on Thursday or Friday."

Some banks bought dollars on behalf of importers, wary of a further depreciation in the rupee, which further weighed on the Indian unit, dealers said. Moreover, the dollar index edged higher tracking sharp losses in the yen, which also weighed on the Indian unit, dealers said. At 1305 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 99.02, against 98.85 Friday and 99.40 Thursday.  

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) 

India Rupee: Technical levels for rupee - Oct 13

MUMBAI – At 1120 IST, the rupee was at 88.7625 per dollar. At 0900 IST, the rupee was at 88.7225 a dollar, against the previous close of 88.6850 a dollar. Following are the key support and resistance levels for the rupee as provided by leading banks and brokerages:

(Rati Chaphekar and Pratiksha)

India Rupee: Falls as risk appetite hit on renewed US-China trade tensions

India Rupee: Falls as risk appetite hit on renewed US-China trade tensions

MUMBAI – The rupee fell slightly against the dollar as investors' risk appetite took a beating after renewed US-China trade tensions, dealers said. US President Donald Trump Friday announced an additional 100% tariff on China after Beijing expanded export controls on rare earth minerals 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 or sooner, Trump said. 

"A lot of downward pressure is there on the rupee," a dealer at a state-owned bank said. "I think it (the rupee) will reach 88.80 (a dollar) but won't fall beyond that. We will see intervention likely by the Reserve Bank of India at that level as usual."

Following Trump's announcement of tariffs on China, the dollar index fell sharply, erasing most of its gains from last week and was broadly steady on Monday. At 0935 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 98.93, against 98.85 Friday and 99.40 Thursday. The index had touched a high of 99.56 on Thursday. 

Moreover, some banks bought dollars on behalf of importers, wary of further depreciation in the rupee, which also weighed on the Indian unit, dealers said. "Importer demand (for dollars) is aggressive. Everyone thinks this level may not be achieved again in the near future unless some very positive news kicks in," a dealer at private-sector bank said. 

However, dealers expect the RBI to intervene through dollar sales to protect the 88.80 a dollar level of the rupee, as has been the case for the last few weeks. 

The Indian unit is also expected to receive some support from overseas investment into the initial public offerings of domestic companies, dealers said. The public offer of Canara HSBC Life Insurance Co. Ltd. opened on Friday and will close on Tuesday. Rubicon Research Ltd. and Canara Robeco Asset Management Co. Ltd.'s IPO opened for subscription Thursday and will close Monday. 

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)

India Rupee - Asia FX: Mixed amid US-China trade tensions; yuan up 0.1%

MUMBAI – Asian currencies traded on a mixed note against the dollar Monday as traders kept an eye out for any fallout of renewed US-China trade tensions.

US President Donald Trump 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 said. However, Trump sounded a softer tone over the weekend, posting on Truth Social that everything would be fine and the US didn't want to "hurt" China.

Following the threat of tariffs, the dollar index erased some of its gains from last week, supporting Asian units. However, a slump in Asian equities in early trade weighed on the currencies. 

The dollar surged last week due to continued uncertainty around the US government shutdown that started last week 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 0850 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 98.92, against 98.85 Friday and 99.40 Thursday. The index touched a high of 99.56 on Thursday. The Thai baht rose 0.3% against the dollar and the Philippine peso rose 0.1%. On the other hand, the South Korean won and Indonesian rupiah fell 0.1%.

The Malaysian ringgit traded steady against the greenback after Malaysia Friday said it plans to boost tax collection and strengthen social protection systems next year, as it looks to bolster government revenue amid external uncertainties. Speaking in parliament, Prime Minister Anwar Ibrahim announced a budget of $111.40 billion for 2026, a record figure that includes investments from some state-linked companies and statutory bodies.

The onshore Chinese yuan rose 0.1% against the dollar after China's export growth picked up pace in September. Data Monday showed outbound shipments from the world's second-largest economy rose an annual 8.3% last month, up from a 4.4% rise in August, and beating the forecast of a 6.0% increase in a Reuters poll. However, at 0850 IST, the Shanghai Composite Index was down nearly 0.8% while Hong Kong's Hang Seng benchmark was down more than 2%. The Taiwan dollar fell 0.1% against the greenback.  (Rati Chaphekar)

India Rupee: Expected range for rupee - Oct 13

MUMBAI – Following are the expected support and resistance levels for the rupee on Monday, 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 Akul Nishant Akhoury

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