Rupee rally pauses after best session in 6 weeks; opens weaker at 87.16/$

Indian Rupee today: The domestic currency opened 21 lower at 87.16 against the dollar on Wednesday, according to Bloomberg

The Indian Rupee slipped a day after posting the highest single-day gain in over six weeks, amid cautious comments from US Treasury Secretary Scott Bessent. 

 

The domestic currency opened 21 lower at 87.16 against the dollar on Wednesday, according to Bloomberg. During the previous session, it rose to the 86.92 level but pared some gains at the end. 

 

The Indian rupee strengthened past 87 after a month as exporters sold and foreign portfolio investor (FPI) equity outflows eased to around ₹600 crore, while they turned buyers in Indian debt, Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP. 

 

 

However, with the dollar index rising and fresh warnings of possible US tariffs on Indian imports of Russian oil, along with geopolitical tensions involving China, the rupee opened weaker on Wednesday, Bhansali said. 

 

The US Treasury warned of possible secondary tariffs and said that the richest families in India benefited from Russian crude oil purchases. 

 

The unit has slipped 1.71 per cent in the current financial year and 1.54 per cent in 2025 so far. In August, it gained 0.74 per cent against the dollar.

 

"The dip to 86.91 on Tuesday offered importers a good opportunity to hedge near-term payables. For today, exporters are likely to wait before selling, while importers are advised to cover near-term liabilities as the rupee faces pressure," Bhansali said. 

 

The gain in the currency in the last two sessions was fuelled by the Centre's proposal to ease the complex GST system into two slabs of 5 per cent and 18 per cent, with a 40 per cent bracket reserved for sin goods. S&P Global's upgrade of India's sovereign credit rating also aided the sentiment. 

 

"With FIIs showing reduced selling pressure, the rupee is expected to trade in a range of 86.60-87.25," according to Jateen Trivedi, VP research analyst - commodity and currency at LKP Securities, said. 

 

The dollar index, a measure of the greenback against a basket of six major currencies, was up 0.09 per cent at 98.35.

 

In commodities, crude oil prices rose slightly after falling overnight amid the rising optimism about a potential Russia-Ukraine truce. Brent crude price was up 0.11 per cent at 65.86 per barrel, while WTI crude prices were higher by 0.06 per cent at 62.39 per barrel, as of 9:20 AM IST.