The Indian rupee appreciated on Thursday, marking its first gain in two weeks, as the central bank intervened decisively in the currency market. A report indicating that policymakers are considering various measures, including a possible interest rate hike, to support the rupee also contributed to the strengthening.
The rupee closed at 96.20, representing a 0.6% increase from the previous session’s close of 96.82, its most significant one-day rise in the past fortnight.
Traders reported that the Reserve Bank of India implemented a robust intervention strategy, executing substantial dollar sales through state-run banks before the market opened. This was aimed at reversing the rupee’s persistent decline, which had recently set numerous all-time lows.
During trading, the rupee briefly surpassed the 96-per-dollar mark before losing ground, although traders noted that dollar sales from state-run banks continued throughout the session. The aggressive nature of the intervention indicated the central bank’s discontent with the rupee’s unidirectional movement, which had dropped from 94.50 on May 8 to a record low of 96.96 on Wednesday, according to a trader from a private bank.
Bloomberg News reported that India is exploring all available options for stabilizing the rupee, including the possibility of raising interest rates, based on information from individuals close to the matter.
In the wider context, Asian currencies fell between 0.1% and 0.4% as Brent crude oil futures remained above $100 per barrel. Investors are closely monitoring developments in negotiations between the U.S. and Iran, which have propelled global oil prices upward by more than 50%.
U.S. President Donald Trump has indicated a willingness to wait a few days for favorable responses from Tehran but remains open to resuming military actions against the country.
Analysts at ING noted that the dollar’s muted response to Trump’s comments suggests potential for further declines if an agreement is reached. They cautioned, however, that a new period of stalled negotiations could push the dollar index above 99.50; it was last recorded at 99.1.
Published on May 21, 2026.
