In the latest session on Wednesday, the Indian rupee strengthened slightly, appreciating by 4 paise to settle at 90.91 against the US dollar in the interbank forex market, supported by a softer greenback and moderate foreign fund inflows. The dollar index, which measures the strength of the US currency against a basket of major counterparts, was trading around 97.68 — indicating a relatively subdued dollar backdrop that helped the rupee’s modest gain.
Analysts said the currency’s move came as other Asian currencies showed resilience, while the domestic unit remained under some pressure from higher import demand and persistent demand for dollars linked to forward contracts. Traders also noted that central bank intervention near the 91-per-dollar level has helped buoy the rupee, countering aggressive bets against it.
Market participants point out that recent foreign portfolio inflows, along with optimism over trade developments and strong economic indicators, have lent support to the Indian currency. Authorities continue to monitor key forex dynamics, including non-deliverable forward (NDF) positions maturing in global markets and their impact on dollar demand. Despite these positives, crude oil price volatility and geopolitical tensions remain risks that could influence currency moves in the near term.
The rupee’s performance continues to reflect a delicate balance between external pressures and internal economic strength. While it remains below its record lows against the dollar seen in recent months, the current rise signals investor focus on inflows, central bank support, and global currency trends. A weaker dollar index often eases pressure on emerging market currencies like the rupee, though domestic and global factors will shape its direction in the coming sessions.
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