Indian Rupee Stabilizes at ₹85.13: Is the Momentum Here to Stay?
After riding a strong five-day rally, the Indian rupee held steady at ₹85.13 against the US dollar in today’s early trading. This flat opening reflects a cooling-off period following last week’s bullish surge, which saw the INR gain ground amid global currency shifts and steady investor sentiment.
What’s Fueling the INR Resilience?
The Indian currency has recently benefited from multiple tailwinds. Notably:
- Consistent Foreign Inflows: Foreign institutional investors (FIIs) have shown increased appetite for Indian equities, thanks to stable macroeconomic indicators and robust Q4 earnings from banks and large caps.
- Cooling Dollar Strength: Global investors are pricing in potential rate cuts by the US Fed later this year, leading to softness in the dollar index (DXY), which supports emerging market currencies like the INR.
- Crude Oil Prices Tamed: Oil prices staying under $85 per barrel have helped reduce India’s import bill, easing pressure on the rupee.
Challenges Ahead for the Rupee
While the short-term sentiment remains constructive, there are looming risks to the rupee’s upside:
- Renewed pressure from a strengthening Chinese Yuan depreciation.
- Possibility of renewed US bond yield spikes, increasing global risk aversion.
- Higher import demand as domestic consumption picks up post-election.
Expert View: Stability Is a Sign of Strength
Market analysts view the rupee’s flat opening not as weakness, but as a healthy consolidation phase. “After a sharp five-day climb, the pause at ₹85.13 signals strength, not fatigue,” .
USD/INR is likely to stay in the 84.80–85.50 range in the near term, barring any geopolitical shocks or abrupt monetary announcements from the US Fed.
Bottom Line
The Indian rupee’s ability to hold its ground at current levels is encouraging for traders and long-term investors alike. While external pressures persist, India’s resilient fundamentals and positive investor flows may continue to support the currency in the coming weeks.