India Rupee Review
Down on dollar buys by importers; FX inflows limit fall
This story was originally published at 17:52 IST on 22 April 2025
Register to read our real-time news.Informist, Tuesday, Apr. 22, 2025
By Gowri Lakshmi
MUMBAI – The rupee settled lower against the dollar Tuesday, ending a five-day streak of closing higher, as importers continued to buy dollars to take advantage of the relatively lower exchange rate, dealers said. Foreign fund inflows into Indian markets coupled dollar sales by exporters prevented the rupee from falling sharply, they said. After moving in a range of over 13 paise during the day, the rupee ended at 85.1875 against the greenback, down from the previous close of 85.1275.
"Equity and G-sec are receiving good amount of flows," a currency trader at a private sector bank said. "With our financial markets performing well, the rupee will continue to strengthen. But the view has changed from yesterday's (Monday's), importers now know the rupee won't rise sharply and move to 85 (a dollar)."
A fall in most other Asian currencies also weighed on the rupee, according to some dealers. Other Asian currencies fell between 0.1-0.4% against the greenback, with the Malaysian ringgit being the worst performer.
The rupee started the day steady against the dollar at 85.1350, after which it began trading lower against the greenback as several importers bought dollars, dealers said. They said most importers remained on the sidelines during early trade as they hoped the rupee would inch towards the key level of 85.00 a dollar later in the day.
The dollar index also remained steady during Asian trading hours as investors assessed the impact of the tariffs by the US and the uncertainties around it. The dollar index hit an over three-year low Monday after US President Donald Trump, Thursday, began to openly criticise US Federal Reserve Chair Jerome Powell for not lowering the federal funds target rate. Trump Monday warned that the US economy may face an economic slowdown if the US central bank did not cut benchmark rates.
Uncertainties around Trump's tariff policies, fears of a likely recession in the US, and a strained trade relation between the US and China prompted investors to shift their funds to other safe-haven assets, which weighed on the dollar index. On Tuesday, the dollar index, which measures the strength of the dollar against a basket of six major currencies, fell to a low of 98.01, down from 98.32 Monday and also from 99.40 Thursday.
Noting the sustained weakness of the US currency, some traders continued to trim their long dollar positions, which supported the rupee. Trump's uncertain trade policies have led to a 5.3% decline in the dollar index since Apr. 2, when Trump announced the aggressive tariff policies against US trading partners, before pausing them on Apr. 9.
The rupee was supported by foreign fund inflows into the domestic stock market and the government bond market, dealers said. Dealers said foreign banks, including UK-based and US-based banks, sold dollars on behalf of overseas investors. Both the benchmark stock indices, the Nifty 50 and the BSE Sensex, ended 0.2% higher Tuesday.
However, towards the end of the market hours, most importers began purchasing dollars as the rupee did not rise as much as they had anticipated, dealers said. "At earlier levels, importers had already hedged and those who did not, waited for more (rise of the rupee). But the flows weren't as much and with a strong resistance near 85, importers began hedging more after 85.15 (a dollar)" a currency trader at a brokerage firm said. The Indian currency touched a low of 85.2025 during the day.
| AT 1530 IST | AT 0900 IST | HIGH | LOW | PREVIOUS(AT 1530 IST) | |
| Spot rupee per $1 | 85.1875 | 85.1350 | 85.0650 | 85.2025 | 85.1275 |
| 1-year dlr/rupee fwd (paise) | 172.69 | 172.88 | 174.38 | 170.50 | 172.68 |
FORWARDS
The one-year dollar/rupee forward premium ended almost unchanged Tuesday as a few banks purchased forward dollars, which offset the downward pressure from a rise in the benchmark US Treasury yield, dealers said. The one-year forward premium had hit a low of 2.0% Tuesday, before a few foreign banks purchased forward dollars, to take advantage of arbitrage between the onshore and offshore non-deliverable forward rates.
Most dealers had expected the one-year exact-period dollar/rupee forward premium to fall below 2.0%, as the benchmark 10-year US Treasury yield rose 8 basis points Monday. Forwards of a currency pair are reflective of the interest rate differential between the two countries. At 1530 IST, the one-year exact period dollar/rupee forward premium was 172.69 paise, little changed from 172.68 paise Monday. On an annualised basis, the forward premium was 2.03%, unchanged from Monday.
OUTLOOK
On Wednesday, the rupee is expected to trade within a range of 85.10-85.40 a dollar. Dealers expect foreign fund inflows, especially into the domestic stock market, will continue to support the rupee. However, a sharp rise of the Indian currency may be limited due to importers' dollar demand, dealers said.
"If the rupee opens at 85.20 or above levels, importers will start buying (dollars) aggressively. Continuous flows are expected and exporters are also seen coming (in) at 85.30 (a dollar) next," a dealer at a private-sector bank said.
The Indian unit will also track movements of the dollar index and the offshore Chinese yuan, dealers said. Market participants are keenly waiting for speeches by multiple US Federal Reserve officials due later in the day, to get more insights into the Fed's interest rate-outlook and about the US economy.
India Rupee - World FX: Dollar index steady; yen up on BoJ rate-hike bets
| AT 1530 IST | HIGH | LOW | PREVIOUS | |
| GBP/USD | 1.3373 | 1.3423 | 1.3362 | 1.3377 |
| EUR/USD | 1.1493 | 1.1548 | 1.1483 | 1.1503 |
| NZD/USD | 0.5998 | 0.6029 | 0.5982 | 0.5991 |
| AUD/USD | 0.6397 | 0.6439 | 0.6392 | 0.6410 |
| USD/JPY | 140.2050 | 141.1680 | 139.8910 | 140.8350 |
| USD/CAD | 1.3842 | 1.3846 | 1.3794 | 1.3839 |
| EUR/JPY | 161.1430 | 162.3140 | 161.1450 | 162.0110 |
| CHF/USD | 1.2318 | 1.2397 | 1.2302 | 1.2348 |
| EUR/CHF | 0.9329 | 0.9339 | 0.9306 | 0.9292 |
MUMBAI – The dollar remained steady against most major global currencies as investors continued to weigh the impact of US tariff policies and the uncertainty around it. US President Donald Trump's open criticism of US Federal Reserve Chair Jerome Powell, coupled with escalating trade tensions between the US and China, prompted investors to shift their funds to other safe-haven assets, which weighed on the dollar index.
Trump began a series of verbal attacks on Powell Thursday for not cutting the federal funds rate and asserted that his administration is evaluating whether it can "fire" the Fed chief. In his latest remarks on Powell, Trump said Monday that the US economy could face a slowdown if the Fed did not lower the benchmark lending rates.
Powell, on the other hand, is of the view that the US central bank needs to assess more economic data and get clarity on Trump's tariff policies before changing the interest rates.
"With these costs trending so nicely downward, just what I predicted they would do, there can almost be no inflation, but there can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW," Trump said on his Truth Social handle.
At 1530 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 98.37, slightly up from 98.32 Monday. Traders await speeches by various Fed officials due later in the day, to get more insights into the Fed's rate outlook and views on the US economy.
The euro traded 0.2% lower against the greenback after major European markets reopened Tuesday after the long Easter weekend. The Swiss franc was down 0.2% against the US currency while the pound sterling was flat.
The Japanese yen was up 0.2% against the US currency after reports that the Bank of Japan was likely to continue to raise its interest rates this year. BoJ board members are, however, expected to lower the country's growth forecast and give insights into the impact of US tariffs on the Japanese economy, Reuters reported. The BoJ's next monetary policy meeting is scheduled on Apr. 30-May 1, where it is widely anticipated to hold rates steady.
The Australian dollar was down 0.1% while the New Zealand dollar was up 0.1% against the greenback. The Canadian dollar was up 0.2% against the US unit. Market participants are now waiting for Canada's Producer Price Index for March due later in the day. (Gowri Lakshmi)
India Rupee: Premium steady as banks' fwd dollar buys offset rise in US yields
| AT 1451 IST | AT 0900 IST | HIGH | LOW | PREVIOUS (AT 1530 IST) | |
| Spot rupee per $1 | 85.1475 | 85.1350 | 85.0650 | 85.1875 | 85.1275 |
| 1-year dlr/rupee fwd (paise) | 173.19 | 172.88 | 174.38 | 170.50 | 172.68 |
MUMBAI – The one-year dollar/rupee forward premium was steady Tuesday as a few banks purchased forward dollars, which offset the downward pressure from a rise in the benchmark US Treasury yield, dealers said.
"I expected it (one-year exact-period dollar/rupee forward premium) to break (fall below) 2.0%, but someone is paying since morning," a dealer with a state-owned bank said. "Some foreign banks are likely to have been paying."
Most dealers had expected the one-year exact-period dollar/rupee forward premium to fall below 2.0%, as the benchmark 10-year US Treasury yield rose 8 basis points Monday. Forwards of a currency pair are reflective of the interest rate differential between the two countries. The one-year forward premium had hit a low of 2.0% Tuesday, before a few foreign banks purchased forward dollars, to take advantage of arbitrage between the onshore and offshore non-deliverable forward rates.
At the same time, most players refrained from placing large bets due to lack of clarity around the health of the US economy, dealers said. Recent attacks by US President Donald Trump on Federal Reserve Chair Jerome Powell only added to this uncertainty. Trump called Powell a "major loser" amid his demands for a rate cut by the Fed. Trump's remarks raised concerns over the independence of the Fed.
Market participants are now looking forward to any comments by Trump, which could provide more information about future rate cuts by the US Federal Reserve. Currently, the Fed is widely expected to keep the rates steady at its meeting on May 6-7.
The dollar/rupee forward premium has been falling for the past two weeks on expectations that the Reserve Bank of India may further cut rates after having cut the repo rate by 25 bps earlier this month, in addition to changing the stance to 'accommodative' from 'neutral'.
At 1415 IST, the one-year exact period dollar/rupee forward premium was 173.19 paise, little changed from 172.68 paise Monday. On an annualised basis, the forward premium was 2.03%, similar to 2.03% Monday. (Sourabh Kumar)
India Rupee: Largely steady as FPI inflows offset importers' dollar buys
| AT 1305 IST | AT 0900 IST | HIGH | LOW | PREVIOUS (AT 1530 IST) | |
| Spot rupee per $1 | 85.1000 | 85.1350 | 85.0650 | 85.1875 | 85.1275 |
MUMBAI – The rupee was largely steady against the dollar as foreign banks sold the greenback for foreign fund inflows into Indian markets, which offset the negative impact of importers' dollar purchases, dealers said. The rupee was also supported by a few exporters' dollar sales, they said. The Indian currency has moved in a range of over 12 paise so far in the day.
Dealers said foreign banks, including UK-based and US-based banks, sold dollars for foreign fund inflows into the domestic stock and government bond markets. "It is a completely flow-driven market now. Exporters are not in a panic mode, but some are selling (dollars) as inflows are not expected to stop any time soon and the rupee is seen appreciating," a dealer at a private sector bank said.
Further, noting the sustained weakness in the US unit, traders sold dollars to trim their long dollar positions, which supported the Indian currency, dealers said. The volatile nature of US President Donald Trump's tariffs has led to the decline in the dollar index by 5.3% since Apr. 2, the day he announced aggressive tariffs against its trading partners, including India, before keeping them on hold on Apr. 9.
Further, Trump's open verbal attack on US Federal Reserve Chair Jerome Powell and escalating trade tension with China has turned investor sentiments jittery, prompting them to move their funds to other safe-haven assets, weighing on the US dollar. At 1305 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 98.31, against 98.32 Monday and 99.40 Thursday.
Meanwhile, banks bought the greenback on behalf of some importers, who wanted to take advantage of the relatively lower dollar/rupee levels, dealers said. The rupee rose to a high of 85.0650 a dollar earlier in the day. However, dollar purchases by importers were not aggressive in nature, with some still continuing to be on the sidelines anticipating a further rise in the rupee, they said.
For the rest of the day, the rupee is seen moving between 84.95 and 85.25 a dollar. Dealers see immediate technical resistance for the Indian unit at 85.00 a dollar. (Gowri Lakshmi)
India Rupee: Technical levels for rupee - Apr 22
MUMBAI – At 1106 IST, the rupee was at 85.1000 per dollar. At 0900 IST, the rupee was at 85.1350 a dollar, against the previous close of 85.1275. Following are the key support and resistance levels for the rupee as provided by leading banks and brokerages:
| Participants | S2 | S1 | R1 | R2 |
| State-owned bank | 85.37 | 85.25 | 85.06 | 84.90 |
| Private bank | 85.35 | 85.21 | 85.05 | 84.91 |
| Private bank | 85.30 | 85.25 | 85.05 | 85.00 |
(Gowri Lakshmi)
India Rupee: Tad down on importers' dollar buys as dollar index falls
| AT 0947 IST | AT 0900 IST | HIGH | LOW | PREVIOUS (AT 1530 IST) | |
| Spot rupee per $1 | 85.1475 | 85.1350 | 85.1350 | 85.1875 | 85.1275 |
MUMBAI – The rupee opened steady against the dollar at 85.1350, before trading lower as importers rushed to purchase dollars to take advantage of the relatively lower dollar/rupee levels, dealers said.
"Importers' dollar demands moved the market in the morning. There is no significant action but some exporters also sold," a dealer at a state-owned bank said. "It's highly likely that with some inflows into bonds and equity (market), the rupee may go to 85.05 (a dollar) and nats (nationalised banks) and exporters will be more aggressive."
The US dollar remained weak and hit an over three-year low on Monday before recovering slightly. The dollar weakened on Monday after US President Donald Trump stepped up attacks on Federal Reserve Chair Jerome Powell. Trump Monday cautioned that the US economy may face an economic slowdown if the Fed did not cut interest rates. "With these costs trending so nicely downward, just what I predicted they would do, there can almost be no inflation, but there can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW," Trump posted on social media.
At 0947 IST, the dollar index, which measures the strength of the dollar, against a basket of six major currencies, was at 98.09, lower than 98.32 Monday and 99.40 Thursday.
Other Asian currencies fell Tuesday, which weighed on the Indian unit, dealers said. "The rupee is definitely having an impact from Asian currencies, it's almost in tandem with CNH (Chinese yuan), its mostly the general outlook about the US and a fear of a recession, investors are moving to gold and other assets," the dealer at the public sector bank said. Other Asian currencies fell 0.0-0.3% against the greenback in early Asian trade.
During the day, the rupee is seen moving between 84.95 and 85.25 a dollar. Dealers see strong technical resistance for the Indian unit at 85.00 a dollar. (Gowri Lakshmi)
India Rupee - Asia FX: Most down on risk-off mood as Trump attacks Fed Powell
MUMBAI – Most Asian currencies traded lower against the US dollar Tuesday as investors turned risk-averse after US President Donald Trump criticised Federal Reserve Chair Jerome Powell for not lowering interest rates.
On Thursday, Trump began a series of verbal attacks on Powell and accused him of "playing politics" and asserted that his administrative team was evaluating whether it could remove Powell from his position at the Federal Reserve. Trump on Monday warned that the US economy could face a slowdown if the Federal reserve did not lower benchmark lending rates, continuing his criticism against Powell.
"With these costs trending so nicely downward, just what I predicted they would do, there can almost be no inflation, but there can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW," Trump said on his Truth social media handle.
At 0908 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 98.12, lower than 98.32 on Monday and 99.40 on Thursday. The US dollar has lost its safe-haven sheen as investors continue to move to other safe-haven currencies, including the Japanese yen and the Swiss franc, amid uncertainty around tariffs by the US.
The Philippine peso was down 0.2% against the greenback after the country's balance of payment was in a deficit of $2 billion in March, against a surplus of $3.1 billion the month before. The Malaysian ringgit fell 0.2% and the Indonesian rupiah was down 0.3% against the greenback. The Thai baht traded 0.1% lower against the US currency.
The South Korean won fell 0.3% after the nation's producer price inflation slowed to 1.3% in March from 1.5% the prior earlier. Further, South Korea's preliminary trade data for April showed that the country's exports fell significantly this month, suggesting that US tariffs were starting to hit global trade. South Korea's exports are said to have dropped 5.2%, according to preliminary trade data figures. The Taiwan dollar was down 0.3% against the greenback.
The Chinese yuan was down 0.3% against the greenback. The People' Bank of China on Monday said it was encouraging state-owned enterprises to prioritise the use of yuan for payment and settlement in overseas expansion, in a move to enhance internationaisation of the yuan amid intensifying global trade tensions.
"It will strengthen the construction of Cross-Border Interbank Payment System (CIPS) ... study and push forward with the application of blockchain technology, and provide safe and efficient settlement and clearing services for global trades, shipping, investment and financing denominated in yuan," China's central bank said in a statement. (Gowri Lakshmi)
India Rupee: Expected range for rupee - Apr 22
MUMBAI – Following are the expected support and resistance levels for the rupee on Tuesday, as forecast by leading banks and brokerages in an Informist poll:
| PARTICIPANT | SUPPORT | RESISTANCE |
| Private bank | 85.30 | 85.00 |
| Foreign bank | 85.50 | 84.90 |
| Brokerage firm | 85.23 | 85.03 |
(Sourabh Kumar)
End
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Ashish Shirke
For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.
Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.
Informist Media Tel +91 (22) 6985-4000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2025. All rights reserved.
To read more please subscribe
Share this Story:
