Overview
- The rupee touched 88.80 per dollar on Monday before closing at 88.77 and then recovered to 88.70 on Tuesday, staying close to its all‑time closing low of 88.81 from Oct. 14.
- Traders report the central bank has been selling dollars via state‑run banks in recent sessions, with intervention smaller than October’s heavy actions and supported by a larger short forward position reported for September.
- The dollar index hit roughly 100.2 as investors dialed back odds of a December Fed cut following Chair Jerome Powell’s caution, with risk‑off flows boosting the greenback alongside the yen and Swiss franc.
- Foreign investors continued net equity selling and India’s forex reserves fell by $6.93 billion to $695.36 billion in the week to Oct. 24, while the 10‑year bond yield is expected to trade around 6.50%–6.60% absent fresh RBI support.
- Goldman Sachs outlined a conditional view that the rupee could gain 1–2% if U.S.–India tariff outcomes are favorable and suggested option trades, while noting the RBI has been defending the 88.80 area.