FX.co ★ Indian Rupee Edges Up on RBI Intervention

The Indian rupee appreciated to approximately 91.6 against the US dollar on Monday, continuing its positive trajectory from the previous trading session, following an early intervention in the pre-market by the Reserve Bank of India. According to traders, state-owned banks facilitated the offering of dollars to bolster the rupee amid prevailing market tensions. Despite this, the currency remains challenged by a widespread risk-averse sentiment coupled with a robust US dollar, further exacerbated by ongoing foreign capital outflows that have exceeded $22.9 billion from Indian equities since 2025. On Sunday, local stock markets were open for a special budget session and experienced their most significant budget-day drop in six years, underscoring domestic risk aversion. Furthermore, the federal budget's unprecedented borrowing target of 17.2 trillion rupees and increased taxation on equity derivatives have heightened investor caution, while moderate revenue growth and the absence of significant reforms have restrained immediate market confidence. Looking forward, market participants are closely monitoring potential measures from the RBI at its monetary policy meeting on February 6 and anticipate forthcoming PMI data.