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Informist, Wednesday, Aug. 12, 2026

 

By Divya Moolayattil 

 

MUMBAI – The rupee closed slightly higher on Wednesday as the Reserve Bank of India sold dollars to mitigate the impact of higher crude oil prices amid rising tensions in West Asia, dealers said. Importers bought dollars, which put pressure on the Indian currency. A few dealers said the market activity was tepid as they awaited the inflation data from US and India to gauge the interest rate outlook of both economies.  

 

"We have the US inflation data today (Wednesday) which can really move the markets. We can expect a gap up or down tomorrow, so the RBI sold dollars actively during the last hour to give a buffer against any global market movements," a dealer at a private sector bank said.

The rupee closed at 95.3300 a dollar Wednesday, higher than its previous close of 95.4350 a dollar. The Indian unit traded in a range of 17 paise during the day. Asian currencies traded mixed on Wednesday, with the South Korean won and Indonesian rupiah being the worst performers and the Thai baht being the best. 

 

The rupee was steady against the dollar and traded in a tight range of 4 paise for most of the day, until media reports emerged that the US and Iran were close to "some sort of arrangement" for a ceasefire, which likely moved the rupee 12 paise higher in the last leg of trade. A few dealers said the central bank's active support helped the Indian unit close higher despite flare-ups in West Asia and rising crude oil prices. 

 

Brent crude oil prices neared $90 per barrel due to rising tension in West Asia, which weighed on the Indian unit, they said. Investors lost confidence in a diplomatic resolution between the US and Iran to end the war and reopen the Strait of Hormuz. At 1530 IST, Brent crude oil for October delivery was at $88.87 a barrel, against $88.91 on Tuesday.

 

Banks bought dollars for importers, amid rising crude oil prices, which put pressure on the Indian unit, they said. "The RBI was not able to do big intervention because of the buying pressure. So, its mild dollar sales only moved a few paise during the day, mainly protecting 95.50 (a dollar)," a dealer at a public sector bank said. 

 

Dealers noted that the RBI was likely intervening actively as a breach of this level could trigger a swift depreciation toward the next technical support level of 95.80 a dollar. 

 

Another respite for the rupee was FPIs, who turned net buyers in domestic equities for the first time in July and so far in August, dealers said. FPIs bought $2.45 billion shares in July and $1.69 billion so far in August. 

 

India's inflation data was released post market hours, at 1600 IST. India's CPI inflation print for July was at 4.45% on year, similar to that in June and largely in line with an Informist poll median of 4.40%. Dealers don't expect much impact of this on markets, as it was in line with expectations.

 

	AT 1530 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	95.3300	95.4000	95.2600	95.4325	95.4350
1-year dlr/rupee fwd (paise)	266.47	268.48	268.48	265.83	266.95

 

FORWARDS

Dollar-rupee forward premiums were down across tenures Wednesday as banks sold forward dollars, dealers said. A few dealers speculated that the Reserve Bank of India sold forward dollars to neutralise the impact of its spot interventions, dealers said. 

 

Forward premiums also fell due to high rupee liquidity in the market, owing to inflows into the foreign currency non-resident (bank) scheme. The RBI had introduced a concessional swap facility scheme to absorb the full hedging costs for banks raising fresh three-to-five year FCNR(B) deposits until Sept. 30. Banks have attracted nearly $36.73 billion from Jun. 8 to Jul. 31. 

 

Importers' demand for buying forward dollars, which kept the one-year forward premium up for three consecutive days, subsided as traders waited for US inflation data. At 1530 IST, the one-year exact period dollar rupee forward premium was 2.78%, down from 2.80% Tuesday. On an absolute basis, the premium was 266.48 paise, against 266.95 paise at close Tuesday. 

 

OUTLOOK 

On Thursday, the rupee is likely to track movement in crude oil prices as news of a ceasefire between the US and Iran emerged, dealers said. The domestic currency will also continue to take cues from movement in the dollar index as traders await US inflation data, due later in the day, for more cues on the interest rate path. The US median price inflation is expected to edge down to 3.6% in July on year from 3.7% in June, which was the highest since September 2023. 

 

Market participants will also keep an eye on potential foreign fund inflows from measures announced by the RBI and the government in June to attract foreign capital, they said. Dealers expect importers to continue buying dollars, which will weigh on the rupee. 

 

The RBI is likely to continue to intervene if the rupee comes under extreme pressure. Dealers see strong technical support for the Indian currency at 95.45 per dollar, a break of which may drag the rupee to 95.75. The rupee is likely to move in a range of 95.20–95.60 against the dollar on Thursday.

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India Rupee: Premiums fall on banks fwd dollars sales, high liquidity

 

	AT 1350 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	95.4075	95.4000	95.3900	95.4325	95.4350
1-year dlr/rupee fwd (paise)	267.33	268.48	268.48	267.05	266.95

 

MUMBAI – Dollar-rupee forward premiums were down across the tenure Wednesday as banks sold the forward dollars, dealers said. Few dealers speculated that the Reserve Bank of India sold forward dollars to neutralise the impact of its spot interventions, dealers said. 

 

The forward premiums also fell due to high rupee liquidity in the market, owing to inflows into the foreign currency non-resident (bank) scheme. The RBI had introduced a concessional swap facility scheme to absorb the full hedging costs for banks raising fresh three-to-five year FCNR(B) deposits until Sept. 30. Banks have attracted nearly $36.73 billion from Jun. 8 to Jul. 31. 

 

The importer's demand for buying forward dollars, which kept the one-year forward premium up for three consecutive days, subsided as traders waited for US and India's inflation data. 

 

"One of the reasons for the forwards being down is that the importer's demand for dollars is low, but the main reason is that the overall INR liquidity is high in the market, the US treasury yield was also up yesterday (Tuesday), the Cash Tom has come down, and the overall curve is also down," a dealer from a foreign bank said. 

 

At 1346 IST, the one-year exact period dollar rupee forward premium was 2.79%, down from 2.80% Tuesday. But on an absolute basis, the premium was 267.33 paise, slightly higher than 266.95 paise at close Tuesday. (Divya Moolayattil and Janaki Venugopalan)

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India Rupee: Steady; RBI's dlr sales offset importers' buys; eyes on US CPI

 

	AT 1250 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	95.4125	95.4000	95.3900	95.4325	95.4350

 

MUMBAI – The rupee held steady against the dollar Wednesday as the Reserve Bank of India sold dollars through public sector banks, countering the impact of a rise in crude oil prices, dealers said. The central bank's mild intervention kept the Indian unit in a tight range during the day. "We can see that the RBI is clearly protecting 95.50 (a dollar) level. If that breaks, the next level would be 95.80. So, the RBI will try hard to keep the rupee in this range (95.40-95.50)," a dealer at a public sector bank said.

 

Many dealers said importers bought dollars actively, noting the sharp rise in crude oil prices, which weighed on the Indian currency. However, some dealers said importers were in a wait-and-watch mode ahead of US inflation data, which will help gauge the interest rate path of the economy, and decide the direction of the dollar and of other currencies. "The market is waiting for CPI data from both India and the US before making any moves. The rupee will be around the same range until there is a new major event," a dealer from a foreign bank said. 

 

They said oil importers are also waiting for a clear direction on the West Asia war front before making any moves as new developments in West Asia fuelled doubts over a deal to reopen the Strait of Hormuz, sending oil prices close to $90 per barrel.

 

Brent crude oil prices rose for the sixth consecutive day, weighing the rupee down, as investors lost confidence in a diplomatic resolution between the two US and Iran, following two separate attacks by the US and Yemen's Houthis on cargo ships. At 1250 IST, Brent crude oil for October delivery was at $89.68 a barrel, up from $88.91 Tuesday.

 

The dollar index held steady ahead of US consumer price index data later in the day, for signals of a near-term rate hike by the US Federal Reserve as market expectations were split. The market is pricing in about a 52% chance of the Federal Reserve keeping rates unchanged in September and a 49% chance of an interest rate hike, according to CME FedWatch.

 

The US median price inflation is expected to edge down to 3.6% on year in July from 3.7% in June, which was the highest since September 2023. Meanwhile, economists expect India's headline inflation in July to remain the same at 4.4% in July despite higher food prices caused by deficient rainfall across the country. 

 

For the rest of the day, the rupee is seen moving between 95.30 and 95.50 against the greenback. Dealers peg immediate technical support for the rupee at 95.45 a dollar. (Janaki Venugopalan and Divya Moolayattil)

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India Rupee: Technical levels for rupee - Aug 12

 

MUMBAI – At 1123 IST, the rupee was at 95.4250 a dollar. At 0900 IST, the rupee was at 95.4000 a dollar, against the previous close of 95.4350. Following are the key support and resistance levels for the rupee as provided by leading banks and brokerages:

 

Participant	S2	S1	R1	R2
Public-sector bank	95.55	95.45	95.30	95.20
Private-sector bank	95.65	95.55	95.30	95.25
Private-sector bank	95.55	95.45	95.30	95.20
Brokerage firm	95.60	95.50	95.30	95.22
Brokerage firm	95.55	95.45	95.35	95.25

 

(Divya Moolayattil)

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India Rupee: Steady as RBI's dollar sales offset rise in crude prices

 

	AT 0930 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	95.4100	95.4000	95.3900	95.4175	95.4350

 

MUMBAI – The rupee opened broadly steady as dealers speculate that the public sector banks sold dollars for the Reserve Bank of India, to prevent the rupee from falling towards 95.50 per dollar, dealers said. "The RBI's robust activity to support the rupee is quite visible. The RBI is using its dollar power these days, so we are seeing a mild move," a dealer at a private sector bank said. The RBI has been supporting the Indian unit continuously despite flare-ups in West Asia and upward pressure on crude oil prices. 

 

Brent crude oil prices rose slightly to near $90 per barrel as tensions in West Asia escalated after the US hit a tanker approaching an Iranian port Tuesday. At 0930 IST, Brent crude oil for October futures were $89.70 per barrel, up from $88.91 Tuesday. Investors lost confidence in a near-term end to the war following two separate attacks by the US and Yemen's Houthis on cargo ships. Most Asian currencies were also steady against the dollar Wednesday as traders cautiously monitored new developments in West Asia.

 

Investors await US consumer inflation data, due Wednesday, to gauge the US Federal Reserve's interest rate outlook and for clearer direction for the dollar index, which will impact the Indian unit. At 0930 IST, the dollar index was at 99.87, up from 99.81 Tuesday. Markets expect the July inflation report to show consumer prices rose 3.4% from a year earlier, compared with 3.5% in June. A slowdown in inflation is likely to reinforce the expectations that the Federal Reserve will keep interest rates unchanged for the September meeting. 

 

For the rest of the day, the rupee is seen moving between 95.30 and 95.50 against the greenback. Dealers peg immediate technical support for the rupee at 95.35 a dollar. (Divya Moolayattil)

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India Rupee - Asia FX: Most steady; W Asia war, US inflation data in focus

 

MUMBAI – Most Asian currencies were steady against the dollar Wednesday as traders cautiously monitored new developments in West Asia. Higher oil prices continued to weigh on the currencies. Investors also await US consumer inflation data Wednesday to gauge the US Federal Reserve's interest rate outlook and the overall strength of the dollar. Crude oil prices rose for the sixth consecutive day and neared $90 per barrel as investors lost confidence in the deal to reopen the Strait of Hormuz following two separate attacks by the US and Yemen's Houthis on cargo ships.

 

The Japanese yen hovered close to 160 against the dollar as traders remained cautious of intervention from Japan and the US. Underlying issues such as wide interest rate differential with the US, rising energy import costs due to the war in West Asia, and soured sentiment over Japan's fiscal outlook weighed the currency down despite the joint intervention by US and Japan. The yen was largely unchanged at 159.40 a dollar Wednesday from 159.29.

 

The South Korean won fell marginally to 1,415.48 Wednesday from 1,412.28 Tuesday against the dollar as demand for dollars and rising oil prices weighed the currency down. The Bank of Korea's outgoing senior deputy governor said Tuesday that the central bank will likely need to raise interest rates further as strong growth feeds into underlying inflation, while adding that the stronger currency and recent stock market moves give policymakers some flexibility in setting policy.

 

The Indonesian rupiah held steady at 17,819 a dollar Wednesday as the nomination of longtime central bank deputy Destry Damayanti to be the next central bank governor boosted market sentiment. The Philippine peso, Thai baht and Taiwan Dollar held steady Wednesday at 61.30, 33.11 and 32.19, respectively, as traders cautiously monitored new developments in West Asia. The Chinese yuan fell slightly to 6.75 a dollar Wednesday from 6.74 Tuesday. (Janaki Venugopalan)

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India Rupee: Expected range for rupee - Aug 12

 

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

 

PARTICIPANT	SUPPORT	RESISTANCE
Public-sector bank	95.60	95.30
Private-sector bank	95.50	95.30
Private-sector bank	95.50	95.30
Foreign bank	95.55	95.20
Brokerage firm	95.50	95.25
Brokerage firm	95.60	95.30

 

 

 

 

 

 

 

 

 

(Divya Moolayattil)

 

End

 

US$1 = INR 95.3300

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

 

Edited by Avishek Dutta

 

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