The Indian rupee appreciated to around 92.7 per dollar, extending gains from the previous session, supported by targeted measures from the Reserve Bank of India aimed at curbing oil-related dollar demand. The central bank has reportedly instructed state-owned oil importers to channel their foreign exchange requirements through a special credit facility at State Bank of India rather than sourcing dollars directly from the open market. This move has reduced immediate USD demand and eased pressure on the rupee, a key consideration given India’s heavy dependence on crude oil imports.
Additional policy steps, including tighter foreign exchange position limits for banks and new curbs on offshore-linked hedging activity, have also helped restrain speculative pressures and bolster the currency. At the same time, foreign investors have turned net buyers of Indian equities, with inflows of roughly INR 3.8 billion lending further support to market sentiment.
Even so, broader risk appetite remains fragile. Persistently elevated crude oil prices and ongoing geopolitical tensions in the Middle East continue to cloud the outlook and temper investor confidence.
