Rupee Rebounds as RBI Intervenes

The Indian rupee held steady at around 90.9 per dollar, pausing its losses from the previous sessions as investors assessed new economic data and ongoing central bank interventions. Market participants remained cautious ahead of the release of India’s updated GDP framework, which is expected to revise the country’s growth metrics. The government is updating the GDP base year to 2022-23 from 2011-12, with advance estimates suggesting 7.6% growth this fiscal year, up from the previous 7.4%. The revision gives greater weight to fast-growing sectors like the digital economy and gig work, while reducing emphasis on agriculture and informal manufacturing. Economists highlight that the updated GDP series will be pivotal for future policy decisions, with the Reserve Bank of India likely to maintain a growth-supportive stance depending on insights from the revised data.

The Indian rupee held steady at around 90.8 per dollar, pausing its losses from the previous session amid broad strength in Asian currencies. Despite this stabilization, the rupee continues to face structural pressures from ongoing corporate dollar demand and weak portfolio inflows, leaving it lagging behind regional peers. Analysts anticipate that the rupee may trade in a narrow range of 90.86–90.88, supported by the Reserve Bank of India’s active interventions. The central bank has consistently stepped in near the psychologically significant 91 level through dollar sales via state-run banks. On the upside, the RBI’s foreign-exchange strategy has provided reassurance, with analysts expecting dollar purchases if the rupee strengthens to 88–89 per dollar. Despite challenges such as a $62 billion short forward book and heavy sovereign borrowing of around INR 30 trillion in the next fiscal year, RBI reserves remain at a record $725.7 billion, providing a strong cushion against volatility.

The Indian rupee fell to around 90.7 per dollar, extending last week’s losses as markets weighed renewed US trade policy uncertainty. Investors are monitoring the fallout from the Supreme Court’s decision striking down Trump’s emergency tariffs, alongside his subsequent temporary 15% levy on imports. Focus remains on India’s postponement of its Washington trade delegation, a move that may prompt a reassessment of its U.S. trade strategy, while traders track oil prices and shifting supply-demand dynamics. On the upside, analysts note that India’s effective tariff rate in the US is now projected at 11–13%, lower than previously feared and favorable relative to regional peers. Markets continue to balance short-term relief from reduced tariff exposure against persistent policy uncertainty and broader global risk factors.