Rupee Gains 28 Paise to ₹94.94, Hits Nearly Two-Month High

The Indian rupee strengthened 28 paise to close at ₹94.94 (provisional) against the US dollar on Tuesday, marking its strongest level in nearly two months. The gains were supported by robust domestic economic growth, controlled fiscal slippage and portfolio-related inflows.

Forex traders said MSCI-linked inflows have provided temporary support to the domestic currency. Market participants also suggested that the Reserve Bank of India (RBI) may have intervened in the foreign exchange market to prevent excessive volatility and support the rupee.

At the interbank foreign exchange market, the rupee opened at ₹95.06 and moved between an intraday high of ₹94.79 and a low of ₹95.10. On Monday, the currency had gained 21 paise to settle at ₹95.22.

“The Indian rupee gained on possible intervention by the RBI and upbeat macroeconomic data. However, weak domestic markets and a surge in crude oil prices capped sharp gains,” said Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan.

Meanwhile, the dollar index rose 0.15% to 99.58, while Brent crude futures climbed 1.97% to USD 92.27 a barrel. Higher crude prices remain a concern for India because of the country’s dependence on imported oil.

Choudhary said the rupee could trade with a slight negative bias amid rising crude prices and renewed geopolitical tensions between the US and Iran. Hawkish signals from US Federal Reserve Chair Kevin Warsh could also weigh on the currency. He projected the USD/INR spot range at ₹94.65-₹95.25.

Domestic equities remained subdued, with the Sensex falling 12.99 points to 76,944.28 and the Nifty declining 24.60 points to 24,055.80.

India’s economy grew 7.8% in the April-June quarter, beating expectations and highlighting domestic resilience. Meanwhile, the central government’s fiscal deficit stood at 26.8% of the FY2026-27 target by July-end, compared with 29.9% during the corresponding period last year.