The rupee opened at ₹94.92 per dollar, a 23‑paise lift from Wednesday’s 95.15 close, marking a 0.24% gain. U.S. Treasury yields slipped 5 basis points, easing pressure on the dollar, while market‑based Fed rate‑hike odds fell from 70% to 50% after September inflation data surprised to the upside—Reuters.
RBI’s latest intervention package opened a direct dollar window for oil firms and introduced a 20% foreign‑exchange risk reserve on derivative contracts over $2 million. The move is designed to curb speculative dollar demand; analysts estimate hedging costs could rise by about 5%, a figure highlighted in the RBI’s recent filing.
The currency’s bounce faced a technical hurdle yesterday when it stalled at 95.00, a level it had not breached since early August. Wright Research’s Sonam Srivastava noted that crude prices climbed 8% year‑on‑year, foreign investor outflows hit ₹500 billion, and net capital inflows dipped 12%—factors that have weighed on the rupee this year.
Looking ahead, the RBI’s October 20 policy meeting will be the focus. The central bank is likely to keep the repo rate at 6.50% but may intensify market‑level interventions if the rupee breaks the 95‑level support, according to RBI’s schedule and market expectations.
For importers and exporters, the tightening FX rules mean hedging budgets will need adjustment. Firms that have long relied on cross‑currency swaps may face higher upfront costs, prompting a shift toward forward contracts and natural hedges via trade flows.