The rupee slipped to a three‑week low on Monday as a stronger dollar pinched the currency, with maturing contracts in the non-deliverable forward adding to the pressure. The rupee fell to 95.40 against the dollar, down 18 paise from the previous close, according to Bloomberg.
“While equities and oil prices showed some positive signs, the rupee’s movement has largely been driven by sentiment, with dollar demand remaining elevated. As a result, many currencies, including the rupee, continue to weaken against the dollar,” said Dilip Parmer, research analyst, HDFC Securities.
The dollar index, which measures the US currency against a basket of six major currencies, rose 0.26% to 101.12 on Monday. Most Asian currencies ended lower. Over the past one month, the index has risen nearly 2% on growing expectations of a hawkish stance from the Federal Reserve.
Oil prices, which had previously weighed heavily on the rupee, is now trading at around $71 a barrel. There has been a 26% fall in oil prices over the past month.
So far in 2026, the rupee has declined 6.15% and over the past year, it fell 10%.
If the dollar index keeps climbing, it would threaten the rupee stabilisation, Parmer said. “Provided the rupee remains below 96, the outlook is not immediately worrisome. In the near-term, I expect the rupee to trade in the range of 94.45-95.80.”
Currency dealers said the Reserve Bank of India carried out modest dollar interventions, capping further weakness.
“The kind of one-sided response of the rupee to the dollar index movement shows that the underlying mood is fragile. In addition, persistent dollar buying from oil companies also pressured the currency during the day,” said Amit Pabari, managing director, CR Forex.
A fresh negative trigger could push the rupee towards 95.80- 96.00, while support holds near 94.80-95.00, Pabari said.
SOURCE : Financial Express
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