The Indian rupee strengthened to around 94.7 per dollar, reaching a three-week high as sustained intervention by the Reserve Bank of India (RBI) bolstered confidence in the currency. Sentiment was further supported by expectations that the central bank will continue to limit excessive exchange-rate volatility ahead of its upcoming policy decision.
Market attention is now fixed on the RBI’s policy meeting, where the benchmark repo rate is widely expected to be kept unchanged at 5.25%. Investors will be closely monitoring the central bank’s updated inflation and growth projections, along with any indications of measures aimed at attracting foreign capital and improving external financing conditions.
However, the rupee’s advance was constrained by renewed geopolitical tensions in the Middle East, which pushed Brent crude prices above $93 per barrel. In addition, uncertainty around US–Iran negotiations and ongoing foreign portfolio outflows from Indian equities limited further appreciation of the currency.
