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Informist, Monday, Jan. 12, 2026

 

By Kabir Sharma

 

MUMBAI – The rupee ended steady against the dollar Monday as banks' dollar purchases on behalf of importers and foreign portfolio investors were offset by state-owned banks' dollar sales on behalf of the Reserve Bank of India, dealers said. Uncertainty around the India-US trade deal looms large over the market and is weighing on the rupee, they said. 

 

"Everyone is focused on the trade talks now," a dealer at a state-owned bank said. "Data from the US just nudges the market, but the trade deal will actually move it."

 

The rupee ended at 90.1525 a dollar, just a wee bit higher than its previous close of 90.1625. The Indian currency touched a low of 90.2525 a dollar during the day but then recovered.

 

The rupee opened lower against the dollar as risk appetite among investors remained weak amid lingering uncertainty about the trade deal, dealers said. Risk sentiment was also dampened after US Federal Reserve Chair Jerome Powell said the Donald Trump administration had threatened him with criminal indictment in connection with the renovation of the Fed headquarters, they said.

 

US Ambassador to India Sergio Gor Monday said there is "no partner more essential than India" and confirmed that the next round of India–US trade talks will take place Tuesday, media reports said. Investors had been bracing for a possible US Supreme Court ruling on the legality of Trump's tariffs Friday. However, the court held off and is now expected to issue its ruling Wednesday.

 

As the rupee approached the day's low of of 90.2525 a dollar, the RBI stepped in by way of dollar sales to prevent runaway depreciation in the domestic currency, dealers said. The central bank's sales, coupled with a fall in the dollar index and recovery in local indices, helped the rupee recover, they said.

 

The dollar index fell after Powell's statement on the possible indictment, stoking concern about the US central bank's independence. This offered some support to the Indian currency, dealers said. At 1310 IST, the dollar index, which measures the strength in the dollar against a basket of six major currencies, was at 98.82, down from 99.14 Friday and 98.85 Thursday. The index had touched a high of 99.25 earlier in the day.

 

The dollar was also under pressure after mixed data from the US left traders guessing on the Fed's next move. According to data published by the US Labor Department Friday, non-farm payrolls increased 50,000 in December, compared with the estimate of 73,000 in a poll by The Wall Street Journal. However, the unemployment rate declined to 4.4%, against expectations of 4.5%.

 

 

	AT 1530 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	90.1525	90.2200	90.1275	90.2525	90.1625
1-year dlr/rupee fwd (paise)	235.35	239.97	239.97	233.11	239.57

 

FORWARDS

The one-year dollar-rupee forward premium fell as banks sold dollars for forward delivery, noting surplus liquidity in the banking system, dealers said. The net liquidity absorbed from the banking system by the RBI--a proxy for the liquidity surplus--was INR 298.72 billion Sunday against INR 274.71 billion Saturday. The RBI conducted an open market operation auction earlier in the day, where it had said it would purchase INR 500-billion worth of seven gilts.

 

The central bank will conduct a $10 billion dollar-rupee buy-sell swap auction Tuesday, which is expected to draw strong participation from state-owned banks, private-sector banks, and corporations. Under the buy-sell swap auction, the RBI will buy dollars for immediate delivery and sell them for delivery after three years.

 

However, the fall in the forward premiums was limited as banks bought dollars for forward delivery on behalf of importers, fearing further weakness in the rupee, dealers said. The rupee fell to a low of 90.2525 a dollar in the spot market Monday.

 

Meanwhile, Friday's crucial US jobs data did little to alter market participants' expectations around the Fed's rate-cut path. US employment growth slowed more than expected in December but a decline in the unemployment rate suggested the labour market was not deteriorating rapidly.

 

At 1530 IST, the one-year exact-period dollar-rupee forward premium was 2.61%, lower than 2.66% Friday. On an absolute basis, the premium was 235.35 paise, against Friday's close of 239.57 paise.

 

OUTLOOK

Tuesday, the rupee may take cues from movements in the dollar index and crude oil prices, dealers said. Any development in the India-US trade deal will be key, they said. 

 

Market participants expect the central bank to continue supporting the rupee through dollar sales next week, particularly after its active spot-market intervention this week. Importers may continue to buy dollars, fearing depreciation in the local unit, they said. Traders will also keep a close eye on further developments related to the India-US trade deal. 

 

The rupee is likely to move in a range of 89.80-90.30 against the dollar. Immediate technical support for the rupee is pegged at 90.30.

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India Rupee - World FX: Dollar index falls after Powell indictment threat

 

	AT 1535 IST	HIGH	LOW	PREVIOUS
GBP/USD	1.3455	1.3470	1.3391	1.3406
EUR/USD	1.1683	1.1697	1.1622	1.1634
NZD/USD	0.5754	0.5760	0.5727	0.5730
AUD/USD	0.6705	0.6712	0.6682	0.6696
USD/JPY	157.8940	158.2020	157.5250	157.8790
USD/CAD	1.3880	1.3917	1.3868	1.3915
EUR/JPY	184.4600	184.5600	183.7610	183.7154
CHF/USD	1.2546	1.2570	1.2473	1.2470
EUR/CHF	0.9311	0.9322	0.9302	0.9326

 

NEW DELHI – The dollar index fell further during European trade after Federal Reserve Chair Jerome Powell said the US administration threatened him with criminal indictment, stoking concerns about the US central bank's independence. The index had gained in early trade after Friday's mixed US jobs report boosted expectations that the Fed would hold interest rates later this month. 

 

Data showed US employment growth slowed more than expected in December but a decline in the unemployment rate suggested the labour market was not rapidly deteriorating. At 1535 IST, the dollar index, which measures the dollar's strength against a basket of six major currencies, was at 98.78, down from 99.14 Friday and 98.85 Thursday. The index had touched a high of 99.25 earlier in the day.

 

The yen was flat against the dollar. On Sunday, the coalition partner of Japanese Prime Minister Sanae Takaichi's party said she might hold snap elections on Feb. 8 or 15, a move that turned investors cautious. 

 

Tracking weakness in the dollar index, both the pound sterling and euro rose 0.4% against the dollar. The Australian dollar was up 0.3%.  (Pratiksha)

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India Rupee: Premium falls on surplus rupee liquidity; RBI swap auction eyed

 

	AT 1420 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	90.1700	90.2200	90.1275	90.2525	90.1625
1-year dlr/rupee fwd (paise)	235.35	239.24	239.83	234.24	239.57

 

NEW DELHI – The one-year dollar-rupee forward premium fell as banks sold dollars for forward delivery, noting surplus liquidity in the banking system, dealers said. "We have been seeing constant recieving since Friday. Liquidity is in surplus," a dealer at a state-owned bank said. "With OMOs (open market operations) and the swap auction, forwards may fall more."

 

The net liquidity absorbed from the banking system by the RBI--a proxy for the liquidity surplus--was INR 298.72 billion Sunday, against a net absorbed liquidity of INR 274.71 billion Saturday. The Reserve Bank of India conducted an open market operation auction earlier in the day, where the RBI had said it will purchase INR 500 billion worth of seven gilts.

 

The central bank will also conduct a $10 billion dollar-rupee buy-sell swap auction Tuesday, which is expected to draw strong participation from state-owned banks, private-sector banks, and corporations. Under the buy-sell swap auction, the RBI will buy dollars for immediate delivery and sell them for delivery after three years. "If the swap is oversubscribed, I am expecting forwards to recover and go up," a dealer at a private-sector bank said. 

 

However, losses in the forward premiums were limited as banks bought dollars for forward delivery on behalf of importers, fearing further weakness in the rupee, dealers said. The rupee fell to a low of 90.2525 a dollar in the spot market on Monday. 

 

Meanwhile, Friday's crucial US jobs data did little to alter market participants' expectations around the Federal Reserve's rate cut path. US employment growth slowed more than expected in December but a decline in the unemployment rate suggested the labour market was not rapidly deteriorating.

 

At 1420 IST, the one-year exact period dollar-rupee forward premium was 2.61%, lower than 2.66% Friday. On an absolute basis, the premium was 235.35 paise, against Friday's close of 239.57 paise.  (Pratiksha)

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India Rupee: Down as importers, FPIs buy dollars; RBI likely limits fall

 

	AT 1310 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	90.2300	90.2200	90.1275	90.2525	90.1625

 

NEW DELHI – The rupee remained slightly lower against the dollar as banks bought dollars on behalf of importers and foreign portfolio investors, dealers said. However, the fall of the Indian unit was limited as state-owned banks sold dollars, likely on behalf of the Reserve Bank of India, dealers said.

 

"We are seeing support around 90.25 (a dollar) levels, just like last week," a dealer at a state-owned bank said. "The underlying demand (of dollars) is there, which is why the direction for rupee remains lower."

 

The central bank likely sold dollars to prevent the local unit from excessive depreciation, dealers said. The RBI likely sold the greenback around 90.25 a dollar, a level around which it had intervened last week as well, they said.

 

Uncertainty over the India-US trade deal remains the biggest pain point for the Indian currency, dealers said. Importers have been actively hedging their foreign exchange exposures on fear that the rupee could fall further, dealers said. US Ambassador to India Sergio Gor Monday said there is "no partner more essential than India" and confirmed that the next round of India–US trade talks will take place Tuesday, media reports said.

 

FPIs continued to buy dollars in order to pull out funds from Indian markets, which weighed on the Indian currency, they said. So far in January, FPIs have withdrawn $803.33 million worth of funds from domestic equities.

 

Meanwhile, the dollar index fell after Federal Reserve Chair Jerome Powell said the US administration threatened him with a criminal indictment, stoking concerns about the US central bank's independence. This gave some support to the Indian currency, dealers said. At 1310 IST, the dollar index, which measures the dollar's strength against a basket of six major currencies, was at 98.82, down from 99.14 Friday and 98.85 Thursday. The index had touched a high of 99.25 earlier in the day.

 

For the rest of the day, the rupee is seen moving between 90.00 and 90.50 against the greenback. Dealers peg immediate technical support for the rupee at 90.30 a dollar.  (Pratiksha) 

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India Rupee: Technical levels for rupee - Jan 12

 

NEW DELHI – At 1105 IST, the rupee was at 90.1750 per dollar. At 0900 IST, the rupee was at 90.2200 a dollar, against the previous close of 90.1625 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	-	90.50	90.00	-
Private-sector bank	90.50	90.30	89.90	89.70
Brokerage firm	90.60	90.40	90.00	89.80
Brokerage firm	90.50	90.30	89.50	89.00

 

(Pratiksha)

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India Rupee - Asia FX: Mixed after US jobs data; South Korean won falls 0.6%

 

NEW DELHI – Asian currencies moved on a mixed note against the dollar after Friday's crucial US jobs data did little to alter expectations around the US Federal Reserve's rate cut path. US employment growth slowed more than expected in December but a decline in the unemployment rate suggested the labor market was not rapidly deteriorating.

 

The US employment report also showed robust wage growth last month, reinforcing expectations the Fed would leave interest rates unchanged at its Jan. 27-28 meeting. US non-farm payrolls increased by 50,000 jobs last month after a downwardly revised rise of 56,000 in November. Economists polled by Reuters had forecast a gain of 60,000 jobs after a previously reported increase of 64,000 in November.

 

The unemployment rate fell to 4.4% last month while that for November was revised down to 4.5% from the previously reported 4.6%. Economists had expected the jobless rate to ease to 4.5%. At 0940 IST, the dollar index, which measures the dollar's strength against a basket of six major currencies, was at 98.96, against 99.14 Friday and 98.85 Thursday. The index had touched a high of 99.25 earlier in the day. 

 

Meanwhile, risk appetite among investors took a beating owing to worries over the Fed's independence after US prosecutors opened a criminal investigation into Fed Chair Jerome Powell. Powell accused the administration of using legal threats to influence policy. This weighed on Asian units. 

 

The South Korean won was down 0.6% against the dollar and the Indonesian rupiah was down 0.2%. South Korea's finance ministry said on Friday that the country would open up its currency market to allow 24-hour trading starting July, further removing restrictions on onshore trading in a bid to win an upgrade to developed-market status. 

 

Meanwhile, both the Malaysian ringgit and Thai baht were up 0.2% against the dollar. The Chinese yuan and the Philippine peso were flat against the US unit.  (Pratiksha)

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India Rupee: Tad down on US trade deal uncertainty, fall in domestic shares

 

	AT 0935 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	90.2300	90.2200	90.1975	90.2475	90.1625

 

NEW DELHI – The rupee fell slightly against the dollar as risk appetite among investors remained weak amid lingering uncertainty about a trade deal between India and the US, dealers said. Risk sentiment was also dampened after US Federal Reserve Chair Jerome Powell said the US administration had threatened him with criminal indictment related to the renovation of Fed headquarters, they said.

 

US Commerce Secretary Howard Lutnick Friday said that the trade deal between New Delhi and Washington has not happened because Indian Prime Minister Narendra Modi did not call US President Donald Trump in time. However, India rejected the claims, with Ministry of External Affairs Spokesperson Randhir Jaiswal saying that the portrayal of the discussions between the two sides was "inaccurate".

 

Investors had been bracing for a possible US Supreme Court ruling on the legality of Trump's tariffs on Friday. However, the court is expected to issue its next ruling on Wednesday. A fall in domestic equities also weighed on the Indian unit, dealers said. At 0935 IST, the Sensex and Nifty 50 were down 0.5?ch. 

 

However, dealers expect the Reserve Bank of India to step in through dollar sales around current dollar-rupee levels in order to limit losses for the Indian unit. The central bank has been selling dollars to keep the rupee from falling past the key support of 90.30 a dollar for the last few weeks, they said. 

 

For the rest of the day, the rupee is seen moving between 90.00 and 90.50 against the greenback. Dealers peg immediate technical support for the rupee at 90.30 a dollar.  (Pratiksha)  

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India Rupee: Expected range for rupee - Jan 12

 

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

 

PARTICIPANT	SUPPORT	RESISTANCE
State-owned bank	90.35	89.90
State-owned bank	90.50	90.00
Private-sector bank	90.50	90.00
Foreign bank	90.45	90.00
Brokerage firm	90.35	90.15
Brokerage firm	90.40	89.90

 

 

 

 

 

 

 

 

 

 

(Pratiksha)

 

End

 

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

 

Edited by Rajeev Pai

 

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