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Informist, Tuesday, Aug. 4, 2026

 

By Divya Moolayattil

 

MUMBAI – The rupee remained broadly steady against the dollar for the third consecutive day Tuesday. The rupee was weighed down by importers' dollar demand amid rising crude oil prices. However, banks' dollar sales on behalf of foreign investors and the Reserve Bank of India kept the Indian unit supported and range-bound throughout the day.

 

"Today's market was very thin. Even the crude and dollar index traded in a small band... Asian peers too. There was importer demand during the day for daily requirements. Otherwise, demand was not very much. RBI's minor support was there," a dealer at a private sector bank said. 

 

The rupee settled at 95.3775 per dollar Tuesday, broadly steady from its previous close of 95.3375. The rupee moved in a narrow range of 15 paise during the day. Other Asian currencies fell against the dollar Tuesday, with the Philippine peso being the worst performer.  

 

The rupee hit a high of 95.2475 per dollar during the day as banks sold dollars on behalf of foreign investors, likely linked to Life Insurance Corporation of India Ltd.'s offer for sale. The OFS opened for non-retail investors on Tuesday. 

 

Importers jumped in as dollar-rupee levels dipped and bought dollars actively. However, dealers said liquidity in the market was very thin as investors were in a wait-and-watch mode ahead of the RBI Monetary Policy announcement on Wednesday. The RBI's Monetary Policy Committee is expected to keep rates and stance unchanged in the policy. 

 

Dealers also said public-sector banks sold dollars for the RBI at around 95.35 Tuesday, wich prevented the rupee from hitting 95.40 a dollar. However, the support from the central bank was very mild, they said. The RBI has been continuously supporting the rupee for a week, shielding it from global tensions. 

 

A rise in crude oil prices put pressure on the Indian unit. Brent crude oil prices inched up after Iran said it was not holding talks with the US. However, US President Donald Trump reiterated that talks with Iran were under way, and that it was Tehran's last chance for a peace deal. At 1530 IST, Brent crude oil for October delivery was $85.87 a barrel, up from $83.77 Monday. 

 

Market sentiment remained supported by higher-than-expected inflows into Foreign Currency Non-Resident (Bank) deposits. Banks have raised $36.73 billion in FCNR (B) deposits from Jun. 8 till Friday. Inflows from FCNR (B) deposits, overseas foreign currency borrowings by banks, and external commercial borrowings by public sector undertakings were at $40.82 billion as of Friday. 

 

	AT 1530 IST	AT 0900 IST	HIGH	LOW	PREVIOUS(AT 1530 IST)
Spot rupee per $1	95.3775	95.3550	95.2475	95.3975	95.3375
1-year dlr/rupee fwd (paise)	273.67	275.88	276.48	271.55	277.00

 

FORWARDS

Dollar-rupee forward premiums fell sharply across tenures Tuesday as dealers speculated that the Reserve Bank of India sold dollars for forward delivery to neutralise its likely spot interventions and avert pushing out rupee liquidity, dealers said. 

 

The one-year dollar-rupee forward premium fell as banks also sold dollars for forward delivery, likely for foreign investors amid a slew of initial public offerings lined up in August, dealers said. The one-year dollar forward premium erased gains made over the previous four days and fell to a low of 271.55 paise, or 2.85%, Tuesday.

 

Dealers said the importers were not very active in the forward market as they remained cautious ahead of the RBI's monetary policy decision.

 

At 1530 IST, the one-year exact period dollar-rupee forward premium was 2.87%, sharply lower than Monday's close of 2.91%. On an absolute basis, the premium was 273.67 paise, against 277.00 paise on Monday. 

 

OUTLOOK

On Wednesday, market participants will track the RBI's monetary policy and comments on inflation, growth and liquidity. "The focus will be on the governor's comments, what they will do with the surplus liquidity. There are chances they may increase the cash reserve ratio for that," a dealer at a public sector bank said. The MPC is expected to keep interest rates on hold and maintain the neutral policy stance, owing to uncertainty over the impact of the war in West Asia and El Nino on economic activity and inflation. 

 

The rupee will also track movements in crude oil prices and the dollar index, dealers said. Dealers expect importers to continue buying dollars, which will weigh on the rupee. They expect the RBI to intervene if the rupee comes under extreme pressure. 

 

Market participants will track foreign fund inflows from the measures announced by the RBI and the government to attract foreign capital, they said. Dealers see strong technical resistance for the Indian currency at 95.20 per dollar. The rupee is likely to move in a range of 95.00–95.40 against the dollar Wednesday.

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India Rupee: Premiums fall sharply; RBI fwd dollar sales speculated

 

	AT 1356 IST	AT 0900 IST	HIGH	LOW	PREVIOUS(AT 1530 IST)
Spot rupee per $1	95.3825	95.3550	95.2475	95.3975	95.3375
1-year dlr/rupee fwd (paise)	272.67	275.88	276.48	271.55	277.00

 

MUMBAI – Dollar-rupee forward premiums fell sharply across tenures Tuesday as dealers speculated that the Reserve Bank of India sold dollars for forward delivery to neutralise its likely spot interventions and avert pushing out rupee liquidity, dealers said. Few dealers said the RBI likely sold dollars at around 95.35 in the spot market to limit the fall of the rupee.

 

The one-year dollar-rupee forward premium fell as banks also sold dollars for forward delivery, likely for foreign investors amid a slew of initial public offerings lined up in August, dealers said. The one-year dollar forward premium erased gains booked in four days and fell to 272.66 paise or 2.86% Tuesday.

 

Positive sentiment prevailed in the market due to Foreign Currency Non-Resident (Bank) deposits, which exceeded market expectations by a wide range. Inflows were from foreign currency non-resident bank deposits, overseas foreign currency borrowings by banks, and external commercial borrowings by public sector undertakings were $40.82 billion from Jun. 8 to Friday, significantly higher than early estimates of around $40 billion till September. Of total inflows, a major portion of these inflows came from FCNR(B) deposits at $36.73 billion. 

 

Dealers also said the importers were not very active in the forward market as they remained cautious ahead of the RBI's monetary policy committee's decision on interest rate.

 

At 1412 IST, the one-year exact period dollar-rupee forward premium was 2.86%, sharply lower than Monday's close of 2.91%. On an absolute basis, the premium was 272.67 paise, against 277.00 paise Monday. (Divya Moolayattil)

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India Rupee: Steady; FX inflows offset importers' dollar purchases

 

	AT 1241 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	95.3500	95.3550	95.2575	95.3675	95.3375

 

MUMBAI – The rupee was steady against the dollar due to lack of flows in the market, dealers said. The market remains in a wait-and-watch mode ahead of the Reserve Bank of India's Monetary Policy Committee's rate decision and Governor Sanjay Malhotra's comments on inflation and liquidity. 

 

The rupee rose to a high of 95.2575 per dollar during the day as banks sold greenback for foreign investors who likely wanted to invest in Life Insurance Corp. of India Ltd.'s offer for sale. However, the rupee immediately erased gains as importers bought dollars. Dealers said importers' strategy is to buy on every dollar-rupee dip. "Importers were bidding, but just for requirements. They were not present in the forwards as well," a dealer at a public sector bank said. 

 

The sentiment in the foreign exchange market remained positive due to higher-than-expected inflows into foreign currency non-resident (Bank) deposits. Banks have attracted $36.73 billion in FCNR (B) deposits from Jun. 8 till Friday.

 

A rise in crude oil prices continued to put pressure on the Indian unit. Brent crude oil prices inched up after Iran said it was not holding talks with the US. However, US President Donald Trump reiterated that talks with Iran were under way, and that it was Tehran's last chance for a peace deal. Brent crude oil for October delivery were $84.53 a barrel, up from $83.77 Monday. 

 

For the rest of the day, the rupee is seen moving between 95.25 and 95.50 against the greenback. Dealers peg immediate technical support for the rupee at 95.40 a dollar. (Divya Moolayattil) 

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India Rupee: Steady as traders remain cautious ahead of RBI's MPC decision

 

	AT 1141 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	95.3400	95.3550	95.2475	95.3675	95.3375

 

MUMBAI – Rupee remained steady Tuesday following three consecutive days of rise as traders cautiously awaited a policy decision from the Reserve Bank of India monetary policy committee on Wednesday. "The rupee will be broadly the same, nothing major happening today. The inflows and dollar demand will keep range-bound movement," a dealer from a foreign bank said.            

 

The dealers expect some foreign fund inflows from the offer for sale by Life Insurance Corporation. But broadly, the rupee is expected to be range-bound throughout the day due to low market activity before the monetary policy decision. "There will be some inflows from the LIC, but it will be broadly offset by market position before the RBI's monetary policy. The market remains cautious before the policy," a dealer from a foreign bank said. 

 

Dealers expect the RBI to keep the interest rate unchanged and would likely provide guidance on the risk of inflation due to geopolitical tensions and El Nino. "I expect the RBI to keep the interest rate in the same range as the crude oil prices are still low and inflation seems to be stable," a dealer from a brokerage firm said. 

 

For the rest of the day, the rupee is seen moving between 95.15 and 95.50 against the greenback. Dealers peg immediate technical resistance for the rupee at 95.00 a dollar. (Janaki Venugopalan)

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India Rupee: Steady as markets assess US, Iran's mixed signals on peace deal

 

	AT 0930 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	95.3100	95.3550	95.3100	95.3675	95.3375

 

MUMBAI – The rupee remained steady against the dollar as investors assessed mixed signals from the US and Iran over the peace deal. Brent crude oil prices inched up after Iran said it was not holding talks with the US. However, US President Donald Trump said that talks with Iran were under way, and that it was Tehran's last chance for a peace deal. Brent crude oil for October delivery were $84.33 a barrel, up from $83.77 Monday. 

 

Dealers expect banks to buy dollars for importers actively, which will weigh on the Indian unit. A dealer at a public sector bank said there were dollar purchases of around $600 million Monday by custodian banks, which kept the rupee under pressure in previous session. Tuesday, outflows from the stake sale in Meesho and Paytm is expected keep the rupee on the edge. 

 

However, inflows into Foreign Currency Non-resident (Bank) deposits, overseas foreign currency borrowings by banks, and external commercial borrowings by public sector undertakings are expected to keep the rupee uplifted. Banks have attracted $40.82 billion from Jun. 8 till Friday. A major portion of these inflows came from FCNR(B) deposits at $36.73 billion.

 

For the rest of the day, the rupee is seen moving between 95.25 and 95.50 against the greenback. Dealers peg immediate technical resistance for the rupee at 95.25 a dollar. (Divya Moolayattil) 

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India Rupee - Asia FX: Most fall, South Korean won rises on inflation data

 

MUMBAI – Most Asian currencies fell Tuesday as oil prices rose over 1% following mixed signals from Iran and the US over peace negotiations. US President Donald Trump said Monday that talks with Iran "are going on right now," adding that Iran faced "decapitation" if Tehran did not agree to a pact to end the conflict. However, Iran contradicted the statement and said that there were no talks under way with the US and no plans for any meetings. At 0800 IST, Brent crude oil for October delivery remained near a three-week low at $84.56 a barrel, up from $83.77 Friday.

 

The Japanese yen fell to 157.70 Tuesday against the dollar, though it remained well above its 40-year low following the the coordinated intervention by the US and Japan. The Japanese currency has surged about 5% over the last three trading sessions following coordinated yen buying intervention by the two countries, which started Friday. The currency was further supported as Japan's Economy Minister Minoru Kiuchi said Tuesday that the pass-through ‌of rising costs due to the West Asia War on consumer goods prices remains limited so far, when asked ‌about the Bank of Japan's warning last week on risk of inflation crossing the central bank's target. 

 

The South Korean won rose for the second consecutive day following lower-than-expected consumer inflation in July. South Korea's consumer inflation softened to a three-month low, though policymakers remained wary of upward price pressures due to uncertainties in the West Asia war. South Korea's consumer price index rose 2.8% in July from a year earlier, after rising 3.2% in June, which was lower than the Street estimate of a 3.0% increase. 

 

The Philippine peso, Thai Baht, and Chinese Yuan fell slightly Tuesday to 60.959, 33.41 and 6.76 per dollar, respectively. (Janaki Venugopalan)

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India Rupee: Expected range for rupee - Aug 4

 

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

 

PARTICIPANT	SUPPORT	RESISTANCE
Public-sector bank	95.50	95.20
Private-sector bank	95.55	95.25
Private-sector bank	95.50	95.15
Private-sector bank	95.50	95.10
Private-sector bank	95.50	95.20
Brokerage firm	95.55	95.10
Brokerage firm	95.45	95.22

 

 

 

 

 

 

 

 

 

 

(Divya Moolayattil)

 

End

 

US$1 = INR 95.3775

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

 

 

Edited by Saji George Titus

 

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