Rupee soars to wipe out year’s losses on strong dollar inflows, ET BFSI
The Indian rupee leaped greater on Monday, with persistent dollar gross sales from overseas banks serving to the native unit claw again all of its losses in 2025 up to now.
The rupee rose to a peak of 85.50 through the session, strengthening previous ranges final seen on the finish of 2024.
The currency closed at 85.6350 in opposition to the U.S. greenback, up 0.4% on the day.
A nine-day streak of good points has boosted the rupee, because the foreign money benefited from greenback inflows associated to inter-company borrowings and repatriation of company income, that are regular in March, the final month of India’s monetary 12 months.
Inflows into Indian bonds – about $3 billion over March up to now – and a pickup in overseas shopping for of Indian stocks over the past couple of buying and selling classes have additionally helped the foreign money, which was teetering close to record-low ranges as lately as final month.
On the day, “provides (on USD/INR) have been dominated by overseas banks however what can be shocking is that the Reserve Bank of India would not appear to be very energetic on bid,” a dealer at Mumbai-based bank mentioned.
The sharp acquire within the rupee additionally seemingly took exporters abruptly, prompting greenback gross sales and including to the momentum, the dealer mentioned.
The foreign money is up 2.1% on the month up to now, outpacing all of its main Asian friends. The benchmark Indian equity index, Nifty 50, rose practically 1.5% on Monday, additionally wiping out all of its losses seen over 2025.
The rupee might lengthen its good points just a little extra however that’s prone to be capped round 85.15-85.20 as importers could bounce in to choose up {dollars} at a cut price, mentioned Dilip Parmar, a overseas change analysis analyst at HDFC Securities.
Whereas the native unit has logged a string of good points lately, some analysts reckon that the rally is underpricing India’s vulnerability to reciprocal U.S. tariffs, slated to be launched on April 2.
