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Informist, Friday, Sept. 25, 2026

By Divya Moolayattil

MUMBAI – The rupee is expected to fall below the 96.00-per-dollar mark for the second time this month Friday as crude oil prices remain elevated despite a slight decline, dealers said. However, market participants expect the Reserve Bank of India to intervene through dollar sales to limit losses for the Indian unit, as it has done in recent sessions.

The rupee is expected to open around 95.95 a dollar Friday after closing at 95.9550 in the previous session. The Indian unit is expected to move in a range of 95.90-96.20 during the day, dealers said.

"Looking at the past actions, I think RBI will be pretty active and try to hold 96 (a dollar) today," a dealer at a brokerage firm said.

While dealers were confident that the RBI would intervene to shield the rupee from a sharp depreciation, some said the central bank could step in aggressively and support the rupee toward 95.75 a dollar, providing a cushion against weekend volatility.

Dealers said the RBI has been selling around $2 billion a day to defend the rupee. "Everything depends on the RBI's actions today. I think they might keep intervening till month-end or till the policy meet," a dealer at a private sector bank said.

Brent crude oil prices fell slightly to around $105 a barrel Friday amid reports that the US and Iran were discussing a phased deal that could reopen the Strait of Hormuz and lift the US blockade on Iranian ports. US and Iranian negotiators were reportedly exploring the arrangement on the sidelines of the United Nations General Assembly in New York, with Qatari officials mediating the talks.

Iran said it would need the US to ease military pressure and lift the blockade before reopening the Strait of Hormuz. The White House has said President Donald Trump remains open to talks with Iran, while maintaining that Washington has little need to negotiate from a position of weakness. 

Brent crude for November delivery touched $108 a barrel late Thursday after Iran-aligned Houthi militants in Yemen launched missiles toward Saudi cities. At 0745 IST, Brent crude was at $105.79 a barrel, down from $106.60 Thursday. Brent traded in a range of $101-$108 in the previous session amid uncertainty over diplomatic efforts to resolve the conflict, keeping market participants cautious.

The dollar index remained near a two-month high for the third consecutive day as bets on a US Federal Reserve rate hike in October increased, which could weigh on the rupee. Traders saw around a 68% probability of a rate hike at the October meeting, compared with around 55% a week earlier. At 0750 IST, the dollar index was at 101.23, compared with 101.25 Thursday.

FORWARDS

The one-year dollar-rupee forward premium is expected to rise slightly for the third consecutive day as dealers expect the RBI to conduct dollar-rupee sell-buy swaps to drain surplus rupee liquidity from the banking system. Banks may also buy forward dollars for importers, which may support the forward premiums. 

On an annualised basis, the premium on the one-year exact-period dollar-rupee forward contract is seen at 3.45-3.50% Friday. Thursday, it settled at 3.44%. On an absolute basis, the premium ended at 329.75 paise. 

End

US$1 = INR 95.9550

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

Edited by Akul Nishant Akhoury

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