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Informist, Friday, May 8, 2026

 

By Pratiksha

 

NEW DELHI – The rupee ended sharply lower against the dollar Friday as fresh hostilities in West Asia dampened investors' risk appetite and pushed up crude oil prices, dealers said. Persistent dollar purchases on behalf of oil marketing companies also weighed on the local unit, they said. However, the Indian unit erased a considerable portion of its losses as banks also sold dollars on behalf of exporters, they said. 

 

After hitting a low of 94.6750 a dollar during the day, the rupee settled at 94.4800 a dollar on Friday, 0.2% lower than its previous close. The Indian currency moved within a 34-paise range during the day. The rupee, however, appreciated by almost 0.5% against the dollar this week.  

 

"The market was swinging on both sides constantly. There was a lot of volatility today as the market is very uncertain on what will happen on the global front," a dealer at a state-owned bank said. "There were both buyers (of dollars) and sellers in the market." 

 

The Indian unit started the day on a weaker footing against the dollar as Brent crude oil prices rose back above the key $100 per barrel mark after renewed hostilities between the US and Iran threatened a fragile ceasefire and dashed hopes for progress on reopening the Strait of Hormuz, dealers said. 

 

Brent crude prices rose after Iran accused the US of violating the month-long ceasefire, while the US said its attacks were retaliatory strikes following Iranian fire on its navy ships transiting through the strait. Brent crude oil futures for July delivery were at $100.50 a barrel at 1530 IST, up from $100.06 a barrel Thursday and $101.27 a barrel Wednesday. It touched a high of $102.92 during the day. 

 

However, shortly after opening, the Indian unit pared some losses as foreign banks sold dollars, likely on behalf of exporters seeking to make the most of the relatively higher dollar-rupee levels, dealers said. Some dealers speculated that state-owned banks may have sold the greenback on behalf of the Reserve Bank of India to limit losses for the Indian unit.

 

"Yesterday (Thursday) also, the RBI unusually sold in the afternoon and today also it was sort of felt that they were there," a dealer at a foreign bank said. "These are peculiar levels to intervene. Seems like they are also testing different strategies."

 

However, banks also bought dollars on behalf of importers, particularly oil marketing companies, who fear a further fall in the rupee amid looming uncertainty related to the war in West Asia, dealers said. 

 

The rupee was wedged between selling and buying of dollars for most of the day as market participants remained uncertain about how the war in West Asia would pan out, especially over the weekend, with some optimistic that a breakthrough in the peace deal may happen. 

 

"People are going long (dollar) and some are going short as well, because nobody really knows where crude will go from here. There's just so much happening in terms of headlines on the war, which is why we saw such sharp moves in the rupee today," a dealer at a private-sector bank said.

 

A fall in domestic equities also weighed on the Indian unit, dealers said. On Friday, the Sensex and Nifty 50 ended 0.7% and 0.6% down, respectively. 

 

However, a fall in the dollar index during European trading hours, tracking gains in the pound sterling, supported the Indian unit, dealers said. At 1530 IST, the dollar index was at 97.99, lower than 98.26 Thursday and 98.02 Wednesday.

 

	AT 1530 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	94.4800	94.5800	94.3350	94.6750	94.2500
1-year dlr/rupee fwd (paise)	290.70	287.80	292.40	287.00	284.00

 

FORWARDS

The one-year dollar-rupee forward premium ended higher Friday, after falling for the previous two days, as banks purchased dollars on behalf of importers, fearing a further fall in the rupee and noting the relatively lower premium levels, dealers said. 

 

The one-year forward premium has fallen over 30 basis points so far this month. "It was expected that forwards would rise today as levels were received quite a lot in the past few days," a dealer at another private sector bank said. 

 

The one-year exact period dollar-rupee forward premium was 3.08% at 1530 IST, up from Thursday's close of 3.01%. On an absolute basis, the premium was 290.70 paise, against 284.00 paise Thursday. 

 

OUTLOOK

On Monday, the rupee will continue to take cues from crude oil price movement amid evolving developments related to the war in West Asia and the peace agreement between the US and Iran, dealers said. If crude prices remain above $100 per barrel, dealers expect the rupee to fall below 95.00 next week. 

 

The local unit will also take cues from movements in the dollar index after the release of the key US non-farm payrolls report, due later in the day, they said. Non-farm payrolls likely increased by 62,000 jobs last month after rebounding by 178,000 in March, a Reuters survey of economists estimated. 

 

Market participants expect importers to continue buying dollars, fearing rupee depreciation amid uncertainty over the situation in West Asia, which may weigh on the Indian currency. 

 

However, most dealers expect the RBI to intervene by selling dollars if the Indian unit comes under extreme pressure. But they don't expect the central bank to intervene aggressively. Market participants will also watch out for any announcement by the central bank to spur foreign inflows into India and support the rupee. Bloomberg Tuesday reported, citing sources, that the RBI was considering a plan for state-owned lenders to issue foreign-currency bonds to attract capital inflows and support the rupee.

 

Dealers now see strong technical support for the Indian currency at 94.80 per dollar. The rupee is likely to move in a range of 94.30-94.80 against the dollar Monday. 

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India Rupee - World FX: Sterling up after local election results; dlr down

 

	AT 1507 IST	HIGH	LOW	PREVIOUS
GBP/USD	1.3616	1.3623	1.3547	1.3549
EUR/USD	1.1769	1.1774	1.1723	1.1726
NZD/USD	0.5964	0.5969	0.5931	0.5935
AUD/USD	0.7237	0.7241	0.7201	0.7204
USD/JPY	156.6530	156.9900	156.6320	156.7500
USD/CAD	1.3647	1.3664	1.3646	1.3657
EUR/JPY	184.3300	184.4425	183.9150	183.9200
CHF/USD	1.2854	1.2861	1.2806	1.2814
EUR/CHF	0.9155	0.9158	0.9149	0.9149

 

MUMBAI – The pound sterling surged 0.5% against the dollar after UK Prime Minister Keir Starmer said he would not resign even as the ruling Labour Party recorded bruising losses in local elections. Results so far showed significant gains for Reform UK, while the Labour and Conservatives recorded notable losses. Investors have been worried that if Starmer is forced out of office, a new, Left-leaning Labour leader could boost public borrowing.

 

The dollar index fell during European trade despite renewed tensions between the US and Iran leaving investors guessing about the next development in West Asia. The US and Iran have both accused each other for the latest flare-up in West Asia, with the latter saying that the US attacked two of its ships in the Strait of Hormuz and its military sites. The US said it was retaliating to Iran's attack on US navy ships transiting the Strait earlier. The dollar index was at 97.99 at 1530 IST, against 98.26 Thursday and 98.02 Wednesday. 

 

Both the euro and yen were down 0.3?ch against the dollar, as demand for safe-haven assets increased. Fear of further intervention by the Bank of Japan is providing support to the yen. The estimate for the size of intervention by Japanese central bank between May 1-6 may be around 4–5 trillion yen, as per reports.

 

Market participants now await the key US non-farm payrolls report, due later in the day. Non-farm payrolls likely increased by 62,000 jobs last month after rebounding by 178,000 in March, a Reuters survey of economists estimated. The Canadian dollar was down 0.2% against the dollar. (Suryash Kumar)

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India Rupee: Premiums rise as importers buy fwd dlrs on rupee's sharp fall

 

	AT 1327 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	94.6100	94.5800	94.3875	94.6750	94.6100
1-year dlr/rupee fwd (paise)	290.70	287.80	292.40	287.00	284.00

 

MUMBAI – The one-year dollar-rupee forward premium rose Friday, after falling the last two days, as banks purchased dollars on behalf of importers, fearing further fall of the rupee and noting the relatively lower premium levels, dealers said. The one-year forward premium has fallen over 30 basis points so far this month.   

 

"Importers are buying dollars in the forward market as they see premiums rising even further. This is leading to a rise in premiums," a dealer at a private sector bank said.

 

The rupee fell sharply against the dollar Friday due to a rise in crude oil prices amid escalation of tensions between the US and Iran. Importers, particularly oil importers, are buying forward dollars owing to the looming uncertainty on the war front, dealers said.  

 

"As the war situation is not improving, the premiums have risen from the lows seen yesterday (Thursday). Buyers are active in the forward market," a dealer at another private sector bank said.

 

The one-year exact period dollar-rupee forward premium was 3.08% at 1327 IST, up from Thursday's close of 3.01%. On an absolute basis, the premium was 290.700 paise, against 284.00 paise Thursday. (Suryash Kumar)

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India Rupee: Pares losses as bks sell dlrs, likely for exporters, FX inflows

 

	AT 1210 IST	AT 0900 IST	HIGH	LOW	PREVIOUS(AT 1530 IST)
Spot rupee per $1	94.4425	94.5800	94.38750	94.5800	94.2500

 

MUMBAI – The rupee erased some early losses against the dollar as state-owned banks and foreign banks sold the greenback, likely on behalf of some exporters and for foreign fund inflows, dealers said. Some dealers speculated the Reserve Bank of India may have sold dollars to support the rupee. The Indian unit fell to 94.5800 a dollar earlier in the day but was trading at 94.4500 at 1230 IST. 

 

"It is a bit difficult to figure out why there is selling (of dollars) in the market but looks like some exporters are there and foreign banks have some flows," a dealer at a private-sector bank said. 

 

The Indian unit was weighed down by a rise in Brent crude oil prices and banks' dollar purchases on behalf of oil importers, dealers said. "Banks are buying on dips (in dollar-rupee) mostly to meet demand from oil importers as the crude oil prices have also gone up. Banks are selling (dollars) too, but for what, it is not clear," a dealer at a foreign bank said. 

 

Crude prices rose above $100 per barrel again after the Iranian military said US forces targeted an Iranian oil tanker in the Strait of Hormuz, while another vessel was attacked near the United Arab Emirates' Fujairah port. However, the US military said the attacks, which also extended onto Iranian land, were part of retaliatory strikes as Iran fired missiles and launched drones at US Navy ships transiting the Strait of Hormuz.

 

Brent crude oil futures for July delivery were at $100.59 a barrel at 1210 IST, up from $100.06 a barrel Thursday and $101.27 a barrel Wednesday. For the rest of the day, the rupee is seen moving in the range of 94.30-94.70. Dealers see immediate technical support for the rupee at 94.60 a dollar. (Suryash Kumar)

 

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India Rupee: Technical levels for rupee - May 8

 

MUMBAI – At 1115 IST, the rupee was at 94.5375 a dollar. At 0900 IST, the rupee was at 94.5800 a dollar, against the previous close of 94.2500. Following are the key support and resistance levels for the rupee as provided by leading banks and brokerages

 

 

Participants	S2	S1	R1	R2
Private-sector bank	95.30	94.90	94.35	94.07
Private-sector bank	-	94.62	94.38	-
Foreign bank	94.75	94.60	94.40	94.25
Brokerage firm	94.80	94.60	94.10	94.00
Brokerage firm	95.00	94.80	94.20	94.00

 

(Suryash Kumar)

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India Rupee: Sharply dn as Brent above $100/bbl on fresh tensions in W Asia

 

	AT 0952 IST	AT 0900 IST	HIGH	LOW	PREVIOUS(AT 1530 IST)
Spot rupee per $1	94.5425	94.5800	94.3875	94.5800	94.2500

 

MUMBAI – The rupee fell sharply against the dollar Friday as Brent crude oil prices rose back above the key $100-per-barrel mark due to renewed hostility between the US and Iran, dealers said. 

 

Iran Thursday accused the US violated the month-long ceasefire between them, while the US said its attacks were retaliatory strikes following Iranian fire on Thursday on its navy ships transiting through the strait. Brent crude oil futures for July delivery were at $101.44 a barrel at 1000 IST, up from $100.06 a barrel Thursday and $101.27 a barrel Wednesday. It fell to $96.16 a barrel Thursday as hopes increased that the US and Iran were close to agreeing to a deal. 

 

However, shortly after opening, the Indian unit erased some losses and touched a high of 94.3875 a dollar. Some dealers speculated that public sector banks may have sold dollars on behalf of the Reserve Bank of India to support the rupee, while others said that dollar sales were likely by private-sector banks for foreign fund inflows.

 

The Indian currency, however, remained under pressure as banks rushed to buy dollars on behalf of importers, fearing further fall of the rupee, dealers said. At 0947 IST, the rupee traded at 94.5400 a dollar, off the day's high of 94.3875.

 

For the rest of the day, the rupee is seen moving in the range of 94.30-94.70. Dealers see immediate technical support for the rupee at 94.60 a dollar. (Suryash Kumar)

 

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India Rupee: Expected range for rupee - May 8

 

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

 

PARTICIPANT	SUPPORT	RESISTANCE
Public-sector bank	95.00	94.30
Private-sector bank	94.50	94.10
Foreign bank	94.90	94.05
Brokerage firm	94.78	93.78
Brokerage firm	94.75	93.75

 

 

 

 

 

 

 

 

(Pratiksha)

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India Rupee - Asia FX: Most down amid fresh hostilities between US, Iran

 

MUMBAI – Most Asian currencies were down against the dollar as tensions escalated in West Asia, with the US and Iran trading fire in the Strait of Hormuz. The US military said that its forces had "eliminated inbound threats," while adding that the "(US military) targeted Iranian military facilities responsible for attacking US forces, including missile and drone launch sites; command and control locations; and intelligence, surveillance and reconnaissance nodes."

 

However, US President Donald Trump said that the ceasefire between the nations remained in effect as Tehran reviews a peace proposal from Washington. The latest escalation heightens uncertainty surrounding the peace talks between the US and Iran, dampening investors' risk appetite. A rise in crude oil prices and a fall in Asian equities also weighed on the currencies. 

 

The South Korean won was down 0.6% against the dollar on Friday, leading the fall in the Asian currency basket. The Malaysian ringgit was down 0.1% against the greenback. Bank Negara Malaysia Thursday held the overnight policy rate at 2.75%. Its policy statement adopted a cautious tone, noting that the West Asia conflict and rising global commodity prices are increasing domestic cost pressures.

 

The Thai Baht was also down 0.1% against the dollar, even after Bank of Thailand Governor Vitai Ratanakorn said Thursday the current inflation spike was temporary and that the government's 400-billion-baht, or $12.39 billion, borrowing plan could boost GDP growth this year. The country's GDP is expected to grow 2.1% this year, up from a previous forecast of 1.5%, and rise to 2.6% next year, he said. 

 

The Indonesian Rupiah was down 0.2% against the dollar. Bucking the trend were the Hong Kong dollar and the Philippine Peso, which were marginally up against the dollar. The peso was up 0.2%, while the Hong Kong Dollar was up 0.1% against the dollar. (Suryash Kumar)

 

End

 

 

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

 

Edited by Saji George Titus

 

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