Rupee slides for third session amid dollar demand; closes at 88.24/$

Indian Rupee today: The domestic currency closed 39 paise lower at 88.24 against the greenback on Monday

The Indian Rupee dropped for the third straight session on Monday amid a fall in the dollar index and optimism over a potential China-US trade deal.

 

The domestic currency closed 39 paise lower at 88.24 against the greenback on Monday, according to Bloomberg. So far this month, the currency has risen 0.62 per cent, while it has fallen 2.64 per cent this year. The currency has outperformed Asian peers, due to Reserve Bank of India (RBI) interventions and optimism of a trade deal with the US. 

 

India’s rupee is facing pressure from importers' dollar demand after a recent rally in the local currency, Bloomberg quoted a MUFG Bank report. There seems to be some good dollar demand from importers at levels stronger than 88 per dollar in the very near-term, the bank said. Uncertainties surrounding the latest US sanctions on Russia and how that may impact global oil prices and affect India could also be at play here, it added. 

   

The overall trend of FPIs to sell equity may have slowed, but the selling continues, according to Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP. "Only a positive aspect from the India-US trade deal could revive the rupee towards the 87.00 level, with the RBI allowing the rupee not to hold on to any particular level."

 

Meanwhile, trade talks between the US and China in Malaysia ended positively ahead of Thursday’s meeting between Donald Trump and Xi Jinping later this week, reports said. US Treasury Secretary Scott Bessent told CBS that Trump’s threat of 100 per cent tariffs is “effectively off the table”. 

 

The dollar index traded slightly lower with economic data releases, including CPI data and September Job figures, delayed amid the government shutdown. The measure of the greenback against a basket of six major currencies was down 0.13 per cent at 98.82.

 

Crude oil prices traded lower amid a potential US-China Trade deal. Brent crude price was down 1.05 per cent at 65.27 per barrel, while WTI crude prices were lower by 1.07 per cent at 60.84 per barrel, as of 3:50 PM IST.  

 

As of September 2025, the real effective exchange rate (REER) of the Indian rupee fell further to 97.6, from 98.8 in August. REER adjusts the nominal effective exchange rate to account for inflation differentials between India and its major trading partners