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Indian Rupee Breaks Losing Streak, Eyes Stability
4 Dec
Summary
- Indian rupee rebounded to 89.97 against the US dollar, ending its losing streak.
- Likely dollar selling by foreign banks and a decline in the dollar index aided recovery.
- Elara Capital forecasts rupee strengthening to 88-88.50 by the end of 2026.
The Indian rupee experienced a notable recovery, closing at 89.97 against the US dollar and halting its prolonged losing streak. This resurgence was attributed to several factors, including likely dollar selling by foreign banks and a weakening dollar index. Reports suggest potential intervention by the Reserve Bank of India may have also contributed.
Market participants are now looking towards the upcoming RBI policy meeting for further guidance on currency stability. Analysts, like those at Elara Capital, predict a strengthening of the rupee to 88-88.50 per dollar by the end of 2026. They also anticipate increased involvement from the RBI in the forex market.
Economic advisors have expressed optimism about the rupee's future, with the Chief Economic Advisor stating the government is not overly concerned about the recent depreciation. While the RBI's Monetary Policy Committee meeting is ongoing, expert opinions are divided on whether a rate cut will be announced amidst currency volatility.
