Rupee Recovers 10 Paise to 91.80 Against US Dollar After Hitting Record Low
Indian currency rebounds from record low as dollar index retreats; forex markets eye global uncertainties and US-India trade talks
India, Jan 27 : The Indian rupee rebounded from record lows, gaining 10 paise to trade at 91.80 against the US dollar in early deals on Tuesday, following a retreat in the dollar index from elevated levels. Forex traders said the modest recovery was driven by broad weakness in the greenback, prompting market participants to cover positions.
At the interbank foreign exchange, the rupee opened at 91.80, up from its previous close of 91.90. The currency had touched a historic low of 92 per dollar last Friday.
“The dollar index fell sharply to a four month low of 96.80 amid pre-FOMC positioning, weakening nearly 1 per cent over the past month,” said Anil Kumar Bhansali, Head of Treasury and Executive Director at Finrex Treasury Advisors LLP.
Despite Tuesday’s rebound, the rupee remains under pressure due to heightened global geopolitical tensions, weak domestic equities, persistent dollar demand, and ongoing capital outflows. Traders noted that the pending US-India trade agreement could serve as a stabilising factor, but external vulnerabilities remain.
US Treasury Secretary Scott Bessent indicated a potential path to remove 25 per cent tariffs on India linked to Russian oil purchases, a move that could ease some pressure on the currency. These tariffs, imposed under former President Donald Trump, had strained bilateral ties.
Forex analysts said year-ahead projections suggest continued rupee vulnerability amid foreign portfolio investors’ equity and debt selling, domestic market weakness, and the RBI’s constrained position. The rupee’s undervaluation by roughly 5 per cent remains the only positive factor.
Meanwhile, the dollar index was trading 0.02 per cent lower at 97.01. Global Brent crude futures declined 1.26 per cent to USD 64.42 per barrel.
In domestic equity markets, the Sensex fell 417.68 points to 81,120.02, while the Nifty declined 111.1 points to 24,937.55. Foreign institutional investors sold equities worth Rs 4,113.38 crore on Friday.
India’s foreign exchange reserves rose by USD 14.167 billion to USD 701.36 billion during the week ended January 16, following a smaller increase of USD 392 million the previous week, according to the Reserve Bank of India.
