Rupee strengthens amid trade deal optimism; ends higher at 88.56/$

Indian Rupee today: The domestic currency closed 13 paise higher at 88.56 against the greenback on Tuesday

The Indian Rupee snapped a two-day losing streak to end stronger on Tuesday amid optimism over India's potential trade deal with the US. 

 

The domestic currency closed 13 paise higher at 88.56 against the greenback on Tuesday, according to Bloomberg. The Rupee has risen 0.23 per cent this month, while it has fallen 3.45 per cent this year, Asia’s second-worst performing currency.  

 

US President Donald Trump indicated that Washington and New Delhi are nearing a new trade agreement, adding that tariffs imposed on India may be lowered in due course. "We’re working on a deal with India, a very different one from before. They don’t love me right now, but they will again. We’re getting a fair deal," Trump said.

 

 

The Indian rupee offers the most potential for gains among Asia’s high-yielding currencies next year, Bloomberg reported, quoting inputs from ING Bank NV. The rupee is set to strengthen to 87 per dollar by the end of 2026, the report said, implying a roughly 2 per cent rise. 

 

While global risk appetite has improved and the US dollar has softened slightly, the currency has remained steady, caught between domestic support measures and external pressures, Amit Pabari, managing director at CR Forex Advisors, said. "It’s a currency on alert, yet far from losing its footing."

 

The rupee weakness is also limited as the Reserve Bank of India (RBI) has been quietly shaping the rupee’s path, providing support that keeps the currency steady amid fluctuating domestic and global conditions, he noted. 

 

Meanwhile, the record 41-day US government shutdown is nearing an end after the Senate passed a temporary funding measure. The Senate’s move has lifted sentiment, but the dollar’s recent strength stems more from the lack of negative news than from solid fundamentals, analysts noted. The measure of the greenback against a basket of six major currencies was up 0.05 per cent at 99.63.

 

In commodities, crude oil prices steadied amid softening market metrics and while trades waited for reports that may hint at global surplus. Brent crude price was up 0.44 per cent at 64.37 per barrel, while WTI crude prices were higher by 0.38 per cent at 60.37 per barrel, as of 3:45 PM IST.