Indian Rupee Eases from One-Month Peak

2025-12-22 06:58 By Joshua Ferrer 1 min. read

The Indian rupee weakened to around 89.7 per USD, easing from a one-month high amid strong dollar demand and rising corporate hedging activity.

The currency recovered nearly 2% last week from all-time lows, boosted by two heavy-handed interventions from the Reserve Bank of India.

However, forward premiums remained high, keeping hedging costs elevated.

Strong demand, extra dollar flows, and position adjustments have all pushed premiums higher, making it more expensive for companies to protect themselves and riskier for speculators.

The currency has dropped more than 6% this year, making it one of the worst-performing emerging market currencies, as steep US tariffs continued to weigh on sentiment.

The rupee is expected to remain under pressure until there is progress in US trade negotiations.

Meanwhile, India and New Zealand struck a free-trade deal, removing or sharply cutting tariffs on most New Zealand exports to India, even as trade talks with the US and EU remain stalled.



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