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Informist, Monday, Aug. 31, 2026

 

By Divya Moolayattil

 

MUMBAI – The rupee rose sharply to almost a four-week high against the dollar Monday as banks sold dollars linked to MSCI global indices rebalancing, dealers said. The rupee also gained support from surplus dollar liquidity in the market, with inflows bunched into the foreign currency non-resident (banks) deposit scheme ahead of Monday's deadline. Along with this, the Reserve Bank of India's dollar sales through public-sector banks also strengthened the rupee on the last day of the month.

 

After hitting a high of 95.1075 per dollar, the rupee settled at 95.1625 per dollar, up 0.2% from Friday's close. During the day, it moved in the widest range seen in the month of 38 paise. The rupee rose 0.2% from its July-end level, with the RBI's dollar sales keeping the currency well behaved despite the occasional bouts of volatility.

 

"There were multiple factors supporting rupee today (Monday), including FCNR(B) inflow, MSCI rebalancing inflows, and... there was RBI's support as well," a dealer at a private-sector bank said.

 

The rupee started the day on a weaker note as crude oil price rose above $90 per barrel after the US and Iran exchanged strikes for the first time in a month, they said. At 1530 IST, Brent crude oil for November delivery was at $91.00 per barrel, up from $88.10 Friday. US Federal Reserve Chair Kevin Warsh's hawkish stance put expectations of a rate hike in September back on the table, which supported the dollar and put pressure on Asian currencies, including the rupee. Traders now see a roughly 57% chance of a rate hike at the US Federal Open Market Committee's next meeting, up sharply from 40% last week, according to CME FedWatch data.

 

The RBI's dollar sales kept the rupee range-bound in the first half of the trading session. The central bank also likely intervened through dollar sales in the offshore non-deliverable forwards market before the spot market opened, some dealers said. The RBI intervention at multiple levels, coupled with foreign fund inflows, strengthened the rupee further.

 

Robust inflows into the RBI's FCNR(B) scheme led to surplus dollar liquidity in the market, which also supported the rupee. The RBI's measures to boost foreign capital inflows have attracted $72.85 billion between Jun. 8 and Aug. 22, of which nearly 90%, or $65.40 billion, have come through the FCNR(B) deposit scheme. Market participants expect FCNR(B) inflows to exceed $90 billion by end of day Monday.

 

Foreign fund inflows linked to the MSCI rebalancing also helped, dealers said. The number of Indian companies in the MSCI global standard indices will increase to 166 from 165 following the rebalancing, which will take effect after trading hours on Monday.

 

Dealers said the month-end flows, which includes exporters' dollar sales through banks, also triggered a sharp rise in the rupee to 95.1075 intraday. Banks bought dollars for importers who wanted to meet their month-end payment obligation, which put pressure on the rupee, they said.

 

	AT 1415 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	95.1625	95.4900	95.1075	95.4900	95.3775
1-year dlr/rupee fwd (paise)	272.88	274.31	275.41	270.71	275.20

 

FORWARDS

Dollar-rupee forward premiums inched lower after banks used the RBI's swap window to offload surplus dollar liquidity stemming from robust FCNR(B) deposit inflows, dealers said. The RBI has allowed banks to tap the swap window for FCNR(B) deposits more than once a week, preventing the dollars from staying idle with banks for a long time, they said. 

 

However, dealers said banks also bought forward dollars on behalf of importers after crude oil prices rose over $90 per barrel, which limited the fall in forward premiums. At 1415 IST, the one-year exact-period dollar-rupee forward premium was 2.87%, down from 2.89% Friday. On an absolute basis, the premium was 272.88 paise, against 275.20 paise at close Friday.

 

OUTLOOK

Tuesday, the rupee is likely to track crude oil prices and developments in West Asia after both the US and Iran resumed strikes at each other. Market participants will keep an eye on the dollar index after Fed Chair Kevin Warsh's speech was more hawkish than the August FOMC meeting.

 

"Going ahead, the rupee will take cues from key US economic data, particularly Non-Farm Payrolls and Unemployment numbers, which could influence the Dollar Index and emerging-market currencies. FII flows and crude oil prices will also remain important for the domestic currency," Jateen Trivedi, vice-president and research analyst, commodity and currency, LKP Securities, said in a note.

 

Dealers expect importer dollar demand to weigh on the currency. However, continued RBI dollar sales are likely to cushion the rupee. Most dealers said the rupee may gradually depreciate as the FCNR(B) inflows end, unless the RBI aggressively defends the domestic currency. 

 

Dealers see strong technical support for the rupee at 95.30 per dollar, a break below which could drag it towards 95.50 a dollar. The rupee is expected to move in a range of 95.15-95.40 per dollar Tuesday.

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India Rupee - World FX: Dollar index edges lower; higher crude price weighs

 

	AT 1450 IST	HIGH	LOW	PREVIOUS
GBP/USD	1.3544	1.3556	1.3530	1.3536
EUR/USD	1.1600	1.1606	1.1579	1.1583
NZD/USD	0.5914	0.5924	0.5902	0.5909
AUD/USD	0.7160	0.7177	0.7154	0.7165
USD/JPY	159.6950	160.1980	159.4780	160.0700
USD/CAD	1.3895	1.3911	1.3889	1.3908
EUR/JPY	185.2300	185.5840	184.9270	185.4200
CHF/USD	1.2365	1.2385	1.2348	1.2343
EUR/CHF	0.9381	0.9384	0.9367	0.9381

 

MUMBAI –  The dollar index edged lower Monday following strong gains made Friday after US Federal Reserve Chair Kevin Warsh hinted at a possible rate hike on inflation concerns. Warsh said the Fed may have more "work to do" to fight inflation. He also said there was little sign that borrowing and lending conditions were restraining the economy and that better inflation readings in the American summer had not convinced him that the underlying trend was improving.

 

The dollar index fell to 99.55 after hitting a two-week high of 99.726 Friday. The other currencies in the index were also under presssure from renewed escalation in the war in West Asia. The US attacked Iran's rocket launchers that were attempting to deploy mines into the Strait of Hormuz Sunday, according to the US Central Command. In retaliation, Iran hit US bases in Jordan. At 1430 IST, Brent crude oil for November delivery was at $91.12 per barrel, up from $88.10 Friday.

 

The euro erased a fall in early trade and rose marginally to $1.1598 as traders expect the European Central Bank to raise interest rates in September to counter inflationary pressures linked to the recent rise in energy prices. 

 

The pound sterling also rose marginally to $1.354 as hawkish Fed remarks supported the greenback. The Japanese yen also rose 0.2% to 159.73 per dollar Monday, but failed to recover from one-month low.

 

The Canadian dollar and the Swiss franc were broadly steady.  (Divya Moolayattil)

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India Rupee: Premiums fall as banks swap dollars raised via FCNR(B)

 

	AT 1415 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	95.2300	95.4900	95.1775	95.4900	95.3775
1-year dlr/rupee fwd (paise)	272.41	274.31	275.41	270.71	275.20

 

MUMBAI – Dollar-rupee forward premiums inched down after banks used the Reserve Bank of India's swap window to offload surplus dollar liquidity stemming from robust foreign currency non-resident (banks) deposit inflows, dealers said. The RBI has allowed banks to tap the swap window for FCNR(B) deposits more than once a week, preventing the dollars from staying idle with banks for a long time, they said. 

 

Non-resident Indians are bunching up dollars in the RBI's scheme ahead of the deadline for its closure Monday. The RBI's measures to boost foreign capital inflows have attracted $72.85 billion between Jun. 8 and Aug. 22, of which nearly 90%, or $65.40 billion, have come through the FCNR(B) deposit scheme. Market participants expect FCNR(B) inflows to exceed $90 billion by Monday.

 

However, dealers said banks also bought forward dollars on behalf of importers after crude oil prices rose over $90 per barrel, which limited the fall in forward premiums. At 1415 IST, the one-year exact-period dollar-rupee forward premium was 2.86%, down from 2.89% Friday. On an absolute basis, the premium was 272.14 paise, against 275.20 paise at close Friday.  (Divya Moolayattil)

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India Rupee: Up sharply on FX inflows, RBI intervention; higher crude weighs

 

	AT 1330 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	95.1900	95.4900	95.1775	95.4900	95.3775

 

MUMBAI – The rupee reversed a fall and rose sharply Monday against the dollar as banks sold dollars linked to MSCI rebalancing, dealers said. The number of Indian companies in the MSCI Global Standard Index will increase to 166 from 165 following the rebalancing, which will take effect Monday.

 

The rupee also gained support from surplus dollar liquidity in the market, with inflows bunched into the foreign currency non-resident (banks) deposits scheme ahead of Monday's deadline. The Reserve Bank of India's measures to boost foreign capital inflows have attracted $72.85 billion between Jun. 8 and Aug. 22, of which nearly 90%, or $65.40 billion, have come through the FCNR(B) deposit scheme. Market participants expect FCNR(B) inflows to exceed $90 billion by Monday.

 

Public-sector banks sold dollars, likely for the Reserve Bank of India, which helped the rupee further, dealers said. The central bank also likely intervened through dollar sales in the offshore non-deliverable forwards market before the spot market opened, some dealers said. 

 

"Multiple factors are helping rupee now. Huge inflow is there... dollar surplus in the market as FCNR(B) scheme ends today, MSCI rebalancing auction is also today," a dealer at a private-sector said. "But, after 2 pm (1400 IST), market will look to buy."

 

However, the rupee was under pressure due to the rise in crude oil prices and Federal Reserve Chair Kevin Warsh's hawkish stance Friday, dealers said. Brent crude oil price crossed $90 per barrel after the US and Iran exchanged strikes for the first time in a month. The US hit Iraian rocket launchers that were attempting to deploy mines into the Strait of Hormuz Sunday, according to the US Central Command. In retailation, Iran struck US bases in Jordan. At 1330 IST, Brent crude oil for October delivery was $90.12 per barrel, up from $88.10 Friday. 

 

Friday, Warsh's statement that the Fed may have more "work to do" to fight inflation put a September rate hike back in focus. Traders now see a roughly 57% chance of a rate hike at the FOMC's next meeting, up sharply from 40% last week, according to the CME FedWatch data.

Banks bought dollars for importers, who wanted to meet their month-end payment obligation and noted a rise in crude oil prices, which put pressure on the rupee, dealers said. For the rest of the day, the rupee is expected to move in the 95.15-95.45 range per dollar. Dealers see immediate technical resistance for the rupee at 95.15 per dollar.  (Divya Moolayattil)

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India Rupee: Technical levels for rupee - Aug 31

 

MUMBAI – At 1121 IST, the rupee was at 95.4425 a dollar. At 0900 IST, the rupee was at 95.4900 a dollar, against the previous close of 95.3775. Following are the key support and resistance levels for the rupee as provided by leading banks and a brokerage:

 

Participant	S2	S1	R1	R2
Public-sector bank	95.70	95.50	95.35	95.25
Private-sector bank	95.60	95.50	95.30	95.25
Private-sector bank	95.70	95.60	95.30	95.20
Foreign bank	95.65	95.55	95.30	95.20
Brokerage firm	95.60	95.50	95.35	95.30

 

(Divya Moolayattil)

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India Rupee: Down on higher crude oil prices; RBI's dollar sales limit fall

 

	AT 0940 IST	AT 0900 IST	HIGH	LOW	PREVIOUS (AT 1530 IST)
Spot rupee per $1	95.4400	95.4900	95.4075	95.4900	95.3775

 

MUMBAI – The rupee fell slightly against the dollar as crude oil prices rose over $90 per barrel after the US and Iran exchanged strikes Sunday, dealers said. At 0930 IST, Brent crude oil for October futures was $90.15 per barrel, up from $88.10 Friday. The Iranian President said that Tehran "is not looking for war," which limited the sharp rise in crude oil prices. 

 

After hitting a low of 95.4900, the rupee was trading at 95.44 in early trade as the public sector bank sold dollars, likely for the Reserve Bank of India, dealers said. The central bank also likely intervened through dollar sales in the offshore non-deliverable forwards market before the spot market opened, some dealers said. "In offshore, the rupee was at 95.55. The RBI's intervention bought it below 95.50 at the open in the spot market. They are still supporting the rupee, and I think it will touch 95.25 today (Monday). Along with the RBI's support, inflows from the MSCI index rejig also helped," a dealer from a public sector bank said.

 

Foreign fund inflows in the market due to the rebalancing of the MSCI index also capped the rupee's fall, they said. The changes in the MSCI index are scheduled to take effect after the close of trading on Aug. 31.

 

For the rest of the day, the rupee is expected to move in the 95.25-95.50 range per dollar. Dealers see immediate technical support for the rupee at 95.50 per dollar.  (Divya Moolayattil)

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India Rupee - Asia FX: Mixed; higher crude weighs; South Korean won rise

 

MUMBAI – Asian currencies were mixed against the dollar Monday as traders assessed Federal Reserve Chair Kevin Warsh's hawkish speech at the Jackson Hole Symposium, which raised the spectre of the US Federal Open Market Committee hiking interest rates in 2026. 

 

At 0840 IST, Brent crude oil for October delivery rose to $90.25 a barrel, up from $88.10 Friday, which put pressure on regional currencies. A rise in crude was due to a fresh exchange of strikes between the US and Iran, which dampened hopes of a near-term peace deal. US forces bombed the IRGC launchers as they were preparing to launch naval mines. In retaliation, Iran launched missiles on US bases in Jordan. 

 

The South Korean won rose 0.2% to 1373.63 per dollar Monday and remained at its strongest level since September 2025, as the currency continued to benefit from the Bank of Korea's back-to-back rate hikes. The rate hike drove the won's significant rebound from its 17-year low in June.

 

The Philippine peso, Thai baht, and Taiwan dollar were broadly steady against the dollar at 62.33, 33.14 and 31.64 per dollar, respectively. The peso remained at an all-time low for the second consecutive day Monday. 

 

The Chinese yuan rose marginally to 6.71 per dollar on Monday. The Singaporean dollar was up 0.1% against the dollar.  (Divya Moolayattil)

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India Rupee: Expected range for rupee - Aug 31

 

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

 

PARTICIPANT	SUPPORT	RESISTANCE
Public-sector bank	95.70	95.40
Private-sector bank	95.70	95.40
Private-sector bank	95.75	95.45
Private-sector bank	95.65	95.40
Brokerage firm	95.65	95.40
Brokerage firm	95.68	95.36

 

 

 

 

 

 

 

 

 

 

(Divya Moolayattil)

 

End

 

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

 

Edited by Rajeev Pai

 

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