Overview

• India launched Operation Sindoor, targeting nine terror camps in Pakistan and PoK, two weeks after the Pahalgam attack that killed 26 civilians.
• On May 8, the rupee experienced its worst performance in over two years, closing at 85.71, a 1% drop, before rebounding to 84.54 in early trade following the US Fed's rate pause.
• Pakistan claimed to have shot down 25 Indian drones, while India reported neutralizing Pakistani missile and drone threats, intensifying cross-border tensions.
• The Reserve Bank of India is expected to intervene to stabilize the rupee, which remains under pressure due to geopolitical risks and a strong dollar.
• Global factors, including crude oil price increases and foreign inflows, continue to influence rupee performance alongside domestic and regional developments.