Overview

• The Indian rupee rallied to 83.83 per dollar on May 2, 2025, marking its strongest level since October 2024 and a nearly 2% weekly gain.
• Foreign institutional investors have been net buyers of Indian equities for 11 consecutive sessions, providing consistent support to the rupee.
• Technical factors, including unwinding of short positions and defensive stop-loss triggers, accelerated the rupee’s advance past the 84-per-dollar threshold.
• Positive signals from the Trump administration regarding US-India trade talks bolstered market sentiment and supported the rupee's rally.
• MUFG revised its year-end rupee forecast to 84, citing expected US dollar weakness, favorable tariff outcomes, and regional currency strength.