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Informist, Wednesday, Sept. 2, 2026

 

By Divya Moolayattil

 

MUMBAI – The rupee ended steady against the dollar despite pressure from higher crude oil prices as the Reserve Bank of India stepped up intervention to support the currency, dealers said. However, dollar demand from importers, rising US Treasury yields and a stronger greenback capped gains, they said.

 

"I think the RBI is intervening actively to control liquidity in the market. They are already conducting VRRR (variable rate reverse repo) auctions every day to absorb liquidity. Since the RBI has huge dollar reserves, it can sell dollars in the spot market and buy rupees," a dealer at a private sector bank said. Dealers estimated that the RBI sold more than $1 billion in the spot market on Wednesday.

 

The rupee ended at 94.9700 per dollar, compared with 94.9500 on Tuesday. The currency moved in a narrow 15-paise range during the day. Most Asian currencies weakened against the dollar, with the Taiwan dollar the worst performer. The South Korean won bucked the trend, rising 0.6%.  

 

The rupee began the day on a stable footing as the RBI intervened in the non-deliverable forwards market before the spot market opened, dealers said. The central bank has the firepower to intervene actively, owing to robust dollar inflows into swap schemes the RBI announced in June, including the foreign currency non-resident bank deposits. India's foreign exchange reserves are at an all-time high of $729.33 billion as of Aug. 21, mainly driven by higher foreign currency assets.

 

"The RBI actively supplied dollars probably because they don't expect crude oil prices to go much higher. And they may have the confidence to be able to buy back the rupee at similar levels later," a dealer at another private sector bank said. 

 

The rupee also gained some support from dollar sales by banks on behalf of foreign portfolio investors. Foreign portfolio investors pumped $2.39 billion into domestic equities in August, falling just short of net purchases of $2.45 billion in July.

 

Dollar purchases by banks on behalf of importers put pressure on the rupee, as importers viewed rising crude oil prices and relatively lower dollar-rupee levels as an opportunity to hedge their requirements.
 

The Indian unit came under pressure Wednesday due to higher crude oil prices, a stronger dollar, and rising US bond yields. Brent crude oil for November delivery rose to a six-week high of over $97 per barrel after the US and Iran launched missile attacks against each other, ending weeks of relative calm in the six-month-old conflict. Media reports said the latest military strikes were far broader and more intense.  

 

The dollar index rose sharply to 99.72 from 99.66 Tuesday, as the greenback's safe-haven status strengthened amid escalating tensions. According to the CME FedWatch tool, the probability of a US Federal Reserve interest rate hike in September surged to 70% from 37% a week ago, strengthening the dollar and pressuring the rupee. The 10-year US Treasury yield rose to its highest level in 3 years, to 4.81%, on Wednesday amid fears of rising inflation driven by higher crude oil prices.

 

	AT 1530 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	94.9700	94.8900	94.8300	94.9800	94.9500
1-year dlr/rupee fwd (paise)	286.03	285.25	287.64	283.53	281.16

 

FORWARDS 

The one-year dollar-rupee forward premium rose slightly to touch a 10-week high as banks bought dollars for forward delivery on behalf of importers, who expect a further rise in crude oil prices amid increased hostilities between the US and Iran, dealers said. 

 

The RBI has been actively selling dollars in the spot market, absorbing the pressure from dollar demand, they said. However, market participants don't expect the central bank to conduct buy-sell swaps to neutralise its spot interventions and add to its already ballooning short dollar forward book. Since spot dollar sales drain rupee liquidity from the banking system, the RBI typically conducts buy-sell swaps to replenish liquidity.

 

At 1530 IST, the one-year exact-period dollar-rupee forward premium was 2.99%, up from Tuesday's close of 2.96%. On an absolute basis, the premium was 286.03 paise, against 281.16 paise Tuesday.

 

OUTLOOK

Thursday, the rupee is likely to track crude oil prices and developments in West Asia as the war escalates, dampening hopes for a diplomatic resolution. Market participants will watch the dollar index after Fed Chair Kevin Warsh's speech was more hawkish than the August FOMC meeting. Investors are also closely watching US economic data – particularly non-farm payrolls and unemployment figures - due later Thursday.

 

Dealers expect importers' dollar purchases to weigh on the currency. However, the RBI's pace of dollar sales will decide the rupee's direction Thursday, as it has since Friday. 

 

Dealers see strong technical support for the rupee at 95.00 per dollar, a break below which could drag it towards 95.15 per dollar. The rupee is expected to move in a range of 94.90-95.15 per dollar Thursday.

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India Rupee - World FX: Dlr nears 3-week high amid escalation in W Asia war

 

	AT 1405 IST	HIGH	LOW	PREVIOUS
GBP/USD	1.3509	1.3522	1.3490	1.3513
EUR/USD	1.1579	1.1597	1.1566	1.1591
NZD/USD	0.5819	0.5897	0.5819	0.5892
AUD/USD	0.7132	0.7153	0.7131	0.7144
USD/JPY	159.6900	160.3920	159.4400	160.1720
USD/CAD	1.3935	1.3935	1.3895	1.3901
EUR/JPY	184.9080	185.7600	184.5510	185.6400
CHF/USD	1.2277	1.2326	1.2277	1.2318
EUR/CHF	0.9431	0.9432	0.9406	0.9406

 

MUMBAI – The dollar held near a three-week high on Wednesday amid fresh escalation in the war in West Asia that drove oil prices higher, reviving concern about inflation and adding upward ‌pressure on bond yields. At 1400 IST, Brent crude oil for November delivery was $94.85 per barrel, up from Wednesday's low of $90.70.  

 

The dollar index, which measures the greenback against a basket of six major currencies, to 99.82, its highest point since Aug. 14. The benchmark 10-year US Treasury yield rose to 4.81%, its highest level in three years. 

 

The euro was down 0.1% at $1.1580, the Sterling pound fell 0.2% to $1.3503, and the Australian dollar fell marginally to 1.400 per dollar.

 

The Japanese yen rebounded and rose 0.3% to 159.68 per dollar after falling to the lowest level since Jul. 31 in early trade Wednesday. The yen came under pressure earlier as Japan's 10-year yield hit 3% for the first time since 1996.

 

The New Zealand dollar fell over 1% against the dollar to $1.72, its lowest level since Aug. 13, even after the Reserve Bank of New Zealand raised its official interest rate by 25 basis points to 2.75%.  (Divya Moolayattil)

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India Rupee: 1-year premium at 10-week high as importers buy forward dollars

 

	AT 1330 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	94.9400	94.8900	94.8400	94.9750	94.9500
1-year dlr/rupee fwd (paise)	285.25	285.25	287.64	283.53	281.16

 

MUMBAI – The one-year dollar-rupee forward premium rose slightly to touch a 10-week high as banks bought dollars for forward delivery on behalf of importers, who expect a further rise in crude oil prices amid the increased hostilities between the US and Iran, dealers said. "The oil spike has definitely led to bids (dollar buying) in the market increasing, but not as aggressive as in previous session," a dealer at a private-sector bank said. 

 

The Indian currency has been steady after rising sharply Tuesday despite a surge in crude oil prices owing to renewal of military strikes in West Asia by the US and Iran, dealers said. The Reserve Bank of India has been actively selling dollars in the spot market, absorbing the pressure from dollar demand, they said.

 

However, market participants don't expect the central bank to conduct buy-sell swaps to neutralise its spot interventions and add to its already ballooning short dollar forward book. Since spot dollar sales drain rupee liquidity from the banking system, the RBI typically conducts buy-sell swaps to replenish liquidity.

 

The RBI's net outstanding sales of dollar-rupee forward contracts jumped to a record high of $136.77 billion at the end of July, owing to the central bank's swap facility to attract foreign inflows through foreign currency non-resident (banks) deposits and external commercial borrowings. The short dollar forward book is only expected to have grown in August.

 

At 1330 IST, the one-year exact period dollar-rupee forward premium was 2.98%, higher than Tuesday's close of 2.96%. On an absolute basis, the premium was 285.25 paise, against 281.16 paise Tuesday.  (Divya Moolayattil)

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India Rupee: Remains steady; RBI's likely dlr sales offset importers' demand

 

	AT 1130 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	94.9575	94.8900	94.8900	94.9725	94.9500

 

MUMBAI – The rupee remained steady against the dollar, moving in a tight range of just 7 paise as public-sector banks sold dollars, likely on behalf of the Reserve Bank of India, despite pressure from higher crude oil prices, dealers said. "The RBI is holding 94.95 levels now. They are the only seller in the market. If they let loose, the rupee will go into a free fall," a dealer at a public sector bank said.

 

Gains for the rupee were capped as banks bought dollars on behalf of importers, who feared further rise in crude oil prices, dealers said. However, this dollar demand was less aggressive than the previous session, as importers anticipated further rise of the Indian currency due to RBI intervention. "Importers' demand is limited today, unlike yesterday, when we saw a lot of buying from importers at noon. The RBI was only supplying dollars as much as the demand, keeping the rupee steady," the dealer said. 

 

The Indian unit's recent stability is at risk due to higher crude oil prices, stronger dollar, and rising US bond yields. Brent crude oil for November delivery rose to a six-week-high of $95.73 per barrel after the US and Iran exchanged missile attacks, puncturing weeks of relative calm in the months-old conflict. The latest military strikes were far broader and more intense, according to media reports. 

 

The dollar index also rose sharply to 99.72 from 99.66 Tuesday on the greenback's safe-haven status amid escalations in the war. Expectations for a US Federal Reserve interest rate hike in September surged to 70%, from 37% a week ago, strengthening the dollar and putting pressure on the rupee.

 

For the rest of the day, the rupee is expected to move in the 94.80-95.10 range. Dealers see immediate technical resistance for the rupee at 94.80 per dollar.  (Divya Moolayattil)

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India Rupee: Technical levels for rupee - Sept 2

 

MUMBAI – At 1100 IST, the rupee was at 94.9600 a dollar. At 0900 IST, the rupee was at 94.8900 a dollar, against the previous close of 94.9500. Following are the key support and resistance levels for the rupee as provided by leading banks and a brokerage: 

 

Participant	S2	S1	R1	R2
Public-sector bank	95.35	95.25	94.85	94.75
Private-sector bank	95.20	95.05	94.95	94.85
Private-sector bank	95.20	95.00	94.90	94.80
Private-sector bank	95.30	95.10	94.90	94.80
Brokerage firm	95.40	95.10	94.95	94.80

 

(Divya Moolayattil)

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 India Rupee: Steady as RBI intervenes; higher crude oil prices weigh

 

	AT 0930 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	94.9475	94.8900	94.8900	94.9625	94.950

 

MUMBAI – The rupee was steady against the dollar despite a sharp rise in crude oil prices as the Reserve Bank of India intervened in the non-deliverable forwards market before the spot market opened, dealers said. India's foreign exchange reserves are at an all-time high of $729.33 billion, mainly driven by an increase in foreign currency assets following inflows into the swap schemes the RBI announced in June, which give the central bank firepower to intervene actively, they said. 

 

Public-sector banks sold dollars for the RBI at around 94.94 in the spot market, supporting the rupee even as global factors pressurise the Indian unit. "The RBI's intervention was expected today as the risk of upside (USD/INR) was there. I think the rupee will be in the same range as yesterday (94.80-95.10)," a dealer at a public-sector bank said.

 

Dealers expect the rupee to be under pressure during the day as crude oil prices hit $97 per barrel for the first time in six weeks after the US and Iran exchanged attacks late Tuesday. At 0915 IST, Brent crude oil for November delivery was at $95.95 per barrel, up from Tuesday's low of $90.70.

 

The 10-year US Treasury yield rose to its highest level in 3 years, to 4.81%, on Wednesday amid fears of rising inflation driven by higher crude oil prices. The dollar index also rose sharply to over 99.76 at 0730 IST, up from 99.66 Tuesday, which weighed on the Indian unit. 

 

For the rest of the day, the rupee is expected to move in the 94.80-95.20 range per dollar. Dealers see immediate technical resistance for the rupee at 94.80 per dollar.  (Divya Moolayattil)

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India Rupee: Expected range for rupee - Sept 2

 

MUMBAI – Following are the support and resistance levels expected for the rupee Wednesday, as forecast by leading banks and brokerages in an Informist poll:

 

PARTICIPANT	SUPPORT	RESISTANCE
Public-sector bank	95.20	94.90
Private-sector bank	95.20	94.80
Private-sector bank	95.40	94.95
Private-sector bank	95.20	94.85
Private-sector bank	95.20	94.90
Brokerage firm	95.15	94.85
Brokerage firm	95.25	94.80

 

 

 

 

 

 

 

 

 

 

(Divya Moolayattil)

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India Rupee - Asia FX: Falls on strong dlr, higher oil; Philippine peso hit

 

MUMBAI – Asian currencies fell against the dollar on Wednesday as the greenback strengthened amid its safe-haven status, following fresh escalation of war in West Asia. The US carried out a new wave of attacks against Iran on Tuesday. Crude oil prices also rose to a nearly six-week high after attacks. 

 

US Central Command said it had struck military targets in Iran in retaliation to attacks on ships and US forces in the region. Hours later, Iran's Revolutionary Guards Corps said it had launched missiles on a US military base in Jordan and its equipment warehouses in Iraq. Iran's Supreme Leader Mojatba Khamenei said they have "unforgettable lessons" in store for Washington. 

 

The Philippine peso fell most among the regional currencies and hit a record low of 62.60 Wednesday as hawkish signals from the US Federal Reserve and intensifying tensions in West Asia lifted the greenback. The peso has plummeted 6.43% this year, marking its sharpest decline among all regional currencies. 

 

The Taiwanese dollar fell 0.2% to 31.71 a dollar and the Thai baht was down marginally at 33.30 per dollar Wednesday. The Chinese yuan also rose 0.2% to 6.72 per dollar. The Japanese yen fell to the lowest level since Jul. 31 as Japan's 10-year yield hit 3% for the first time since 1996.

 

Bucking the trend, the South Korean won rose to a 13-month high to 1,369.38 per dollar as strong semiconductor exports boosted dollar inflows and encouraged exporter selling. South Korea's exports jumped 68.7% year-on-year to $98.25 billion in August, while the trade surplus reached $34.75 billion.  (Divya Moolayattil)

 

End

 

US$1 = INR 94.9700

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

 

Edited by Saji George Titus

 

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