The Indian rupee appreciated by five paise, closing at 88.67 (provisional) against the US dollar on Monday. The gain was influenced by suspected intervention from the Reserve Bank of India (RBI) and fresh inflows from foreign funds.
Forex traders noted that the domestic currency faced resistance due to renewed trade tensions between the US and China, which led to increased risk aversion in global markets. At the interbank foreign exchange market, the rupee opened at 88.75 and traded within a range of 88.57 to 88.79 before settling at its provisional close of 88.67, which is a five-paise rise from the previous close.
On the preceding Friday, the rupee had appreciated by seven paise, closing at 88.72. Tensions escalated as the US threatened to impose an additional 100 percent tariff on Chinese goods following China’s recent controls over rare earth exports.
Traders observed that the USD/INR pair benefited from optimism surrounding ongoing trade talks between India and the US, alongside expected RBI interventions. Anuj Choudhary, a research analyst for currencies and commodities at Mirae Asset ShareKhan, indicated that the US government shutdown and increasing chances of a rate cut by the US Federal Reserve could further bolster the rupee. However, he also expressed concern that risk aversion from the revived US-Sino trade conflict might limit substantial gains. He emphasized that traders would be watching India’s Consumer Price Index (CPI) data for further cues.
Positive sentiment in the forex market was reportedly driven by expectations following reports that a senior official delegation from India was scheduled to visit the US this week for trade discussions. This followed a recent visit by Commerce and Industry Minister Piyush Goyal, who led a delegation to New York, resulting in an agreement to continue negotiations for a mutually beneficial bilateral trade agreement.
Simultaneously, the dollar index, which measures the US dollar’s strength against a basket of six currencies, was trading 0.13 percent higher at 99.10 due to ongoing safe-haven demand. Brent crude oil prices were also rising, up 1.90 percent to $63.91 per barrel in futures trading.
In the domestic equity market, the Sensex fell by 173.77 points to close at 82,327.05, while the Nifty index declined by 58 points, finishing at 25,227.35. Additionally, Foreign Institutional Investors purchased equities worth ₹459.20 crore on Friday, according to exchange data.
India’s foreign exchange reserves decreased by $276 million to $699.96 billion for the week ending October 3, as reported by RBI data. This follows a previous drop of $2.334 billion to $700.236 billion in the week prior.
Published on October 13, 2025.
