Indian Rupee gains after snapping nine-day rally; Opens at 85.68/$
The domestic currency strengthened by 9 paise to open at 85.68 against the greenback after closing at 85.77 on Monday
 "Indian Rupee gains after snapping nine-day rally; Opens at 85.68/$")
The Indian rupee opened stronger on Wednesday, even as a slight rise in the dollar and crude oil prices weighed on the currency.
The domestic currency strengthened by 9 paise to open at 85.68 against the greenback after closing at 85.77 on Monday, according to Bloomberg data. The currency snapped its nine-consecutive day of gains on Tuesday, marking an end to the best winning streak since January 2024. The currency has appreciated by 2.2 per cent in March so far, tracking the fall in the dollar index. Meanwhile, during the current financial year, it witnessed a 2 per cent fall.
With India’s liquidity deficit standing at ₹2.06 trillion and financial year-end tax outflows adding to the stress, the rupee could face renewed pressure, according to Amit Pabari, managing director of CR Forex Advisors. Additionally, geopolitical risks—from Israel’s offensive in Gaza to US airstrikes on Iran-backed Houthi rebels—are driving demand for safe-haven assets like the dollar, he said.
The dollar index — a measure of the value of the US dollar relative to a basket of foreign currencies — was up 0.06 per cent at 104.25. The dollar index was weakened by 3.26 per cent in March, the highest since November 2022.
Given the current market dynamics, the dollar-rupee pair is likely to find strong support around 85.40-85.50, with a potential rebound towards 86.50 levels in the short term, Pabari said.
Today is the expiry day for March contracts, and some buying possibly could emerge from the oversold positioning of RBI to square up these positions, says Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP. Exporters will continue waiting for their receivables hedging while importers may buy the dips for any hedging left, he said.
Meanwhile, FIIs remained net buyers of ₹5,371.57 crore from Indian equities on Monday. Global funds have pulled out ₹1.32 trillion from domestic stocks so far this year.
Crude oil prices rose as US President Donald Trump threatened a 25% tariff on countries purchasing oil and gas from Venezuela. Brent crude oil was up 0.34 per cent to $73.27 per barrel, while WTI crude was up 0.38 per cent at 69.26 per barrel as of 9:10 AM IST.