NEW DELHI — The rupee closed Friday’s session 20 paise higher at 94.79 against the US dollar, a modest but stabilizing gain after Thursday’s 18-paise climb to 94.99. The move was fueled by a softening US dollar and the structural forex support from the Reserve Bank of India (RBI).
But the rally hit a ceiling. Brent crude futures hovered near $105.35 per barrel, a price level that continues to drain India’s foreign exchange reserves. Anuj Choudhary, research analyst at Mirae Asset Sharekhan, noted that while the dollar index dropped 0.54% to 102 and US Treasury yields eased, the “surge in crude oil prices capped sharp gains.”
The macro backdrop was mixed. US Producer Price Index (PPI) data came in hotter than expected, and retail sales topped forecasts, yet weekly unemployment claims stayed in line with projections. This patchwork of data left the dollar vulnerable but the rupee cautious.
On Dalal Street, the mood swung wildly. The BSE Sensex opened 113 points down at 74,187, and the NSE Nifty50 slipped 27.20 points to 22,967.15. By mid-session, however, both indices turned green, with the Sensex gaining 400 points and the Nifty50 crossing 23,100. Foreign Institutional Investors (FIIs) had been net sellers of ₹5,285.37 crore worth of domestic equities on Thursday, a trend that weighed on early sentiment.
The next catalyst is clear: crude oil prices and the RBI’s next intervention window. Traders will watch the dollar index closely; if it breaks below 101, the rupee may test stronger levels. For now, the currency holds at 94.79, a fragile equilibrium in a volatile global market.