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Informist, Wednesday, Sept. 9, 2026

By Divya Moolayattil

MUMBAI – The rupee is expected to consolidate against the dollar Wednesday after its sharp fall in the previous session as persistent dollar demand from importers and elevated crude oil prices are likely to keep pressure on the currency, while intervention by the Reserve Bank of India is expected to limit the downside, dealers said.

The rupee is likely to open at around 94.77-94.82 a dollar after ending at 94.8175 Tuesday, posting its biggest single-day fall in seven weeks. The Indian currency is expected to move in a range of 94.65-94.95 during the day, dealers said.

The rupee may see some consolidation after Tuesday's largely one-sided move, when higher crude oil prices amid escalating tensions in West Asia weighed heavily on the currency. Dealers said the RBI is likely to continue supplying dollars to prevent a sharp depreciation, particularly as the war intensifies.

"The RBI won't allow the rupee to break 95.00 today. That level will be well protected," a dealer at a private sector bank said. "Otherwise, throughout the day, the RBI may supply dollars, but not aggressively."

Brent crude oil prices remained near the $100-per-barrel mark Wednesday as the US and Iran fired missiles, adding to pressure on the rupee. The US military said Tuesday that it had destroyed five Iranian oil tankers in retaliation for strikes by Iran on a US Navy warship. At 0800 IST, Brent crude oil for November delivery was at $99.29 a barrel, up from $97.92 Tuesday.

Banks are also likely to step up dollar purchases for importers amid fear that further escalation in the war in West Asia could push crude prices higher, dealers said. Importers were estimated to have bought around $2 bln of dollars Tuesday, contributing significantly to the rupee's fall, they said.

The rupee is also likely to take cues from the dollar index, which remained subdued as investors awaited US inflation data due Friday. The data could influence expectations for the Federal Reserve's interest-rate trajectory and provide direction to the dollar. Market-implied odds of a rate hike at the Fed's September meeting stood at 60%, up from 44.4% a month ago.

FORWARDS

Dollar-rupee forward premiums may inch down as benchmark US 10-year Treasury yield remained elevated at around 4.80%, close to their highest level since November 2023. Banks may buy forward dollars for importers, which may limit the fall of forward premiums, dealers said. 

On an annualised basis, the premium on the one-year exact-period dollar-rupee forward contract is seen at 2.97-3.04% Wednesday. On Tuesday, it settled at 3.05%. On an absolute basis, the premium ended at 289.00 paise.

End

US$1 = INR 94.8175

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

Edited by Akul Nishant Akhoury

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