Rupee depreciates beyond 86 per dollar on foreign bank, corporate bids

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The rupee depreciated against the US dollar on Monday, breaching the 86-per-dollar mark. The currency was pushed to an intraday low of 86.05 per dollar due to foreign banks and large corporations stocking up on dollars, according to dealers.

 

Additionally, rise in crude oil prices weighed on the local currency.

 

The rupee settled at 85.99 per dollar, against the previous close of 85.78 per dollar. It has depreciated by 0.6 per cent in 2025-26 (FY26), and has witnessed a depreciation of 0.4 per cent in the ongoing calendar year so far. In July, it has depreciated by 0.3 per cent. 

 

“There was persistent demand for dollars from foreign banks and large corporations. Further the dollar index was up, along with crude oil prices,” a dealer at a state-owned bank said.

 

Brent crude oil prices rose by over 2 per cent to $71.22 per barrel. Meanwhile, the dollar index rose by 0.14 per cent to 97.91. 

 

Market participants said the Reserve Bank of India intervened in the foreign exchange market via dollar sales, which capped losses.

 

Tariff threats from United States (US) President Donald Trump have heightened global trade tensions, fuelling risk aversion among investors and putting pressure on other Asian currencies. Traders also stayed cautious ahead of the US inflation data release due after market hours on Tuesday.

 

“The Indian rupee depreciated following fresh tariff threats from Trump. These threats have escalated global trade tensions, leading to increased risk aversion among investors and subsequently weighing down other Asian currencies as well. Traders remain cautious ahead of the inflation data release scheduled for Tuesday. Spot USDINR has support at 85.55 and resistance at 86.27,” Dilip Parmar, senior research analyst, HDFC Securities, said. 

 

India remains one of the few major US trade partners yet to receive a formal tariff notice. Indian negotiators are expected to return to Washington soon for another round of talks, focusing on unresolved issues related to auto components, steel, and agricultural products.