Indian Rupee vs US Dollar: The trend of decline in the Indian rupee continues. Due to the strength of the US dollar, the Indian currency remained in a limited range in early trade on Monday and fell by 5 paise to reach Rs 88.77 per dollar. Foreign exchange traders say that the rupee remains close to its all-time low.

Anil Kumar Bhansali, Head of Treasurer and Executive Director, Finrex Treasury Advisors LLP, says that the market sentiment for this pair (rupee-dollar) is influenced by the strength of the US dollar. Also, the mild risk-off environment at the global level and domestic factors such as the stable policy stance of the RBI and the outlook for controlled inflation are also contributing to this.

Bhansali further said that there has been a slight decline in the dollar index, which is due to the easing of trade tensions between America and China (US-China trade war). He also said that volatility in the global market and geopolitical developments will remain the major factors determining the direction of the rupee in the near future.

Why is the rupee falling?

In the Interbank Foreign Exchange Market, the rupee opened at Rs 88.75 per dollar and fell to Rs 88.77 within a short time. This shows a decline of 5 paise from the previous session’s closing price of Rs 88.72 per dollar. Earlier on Friday, the rupee had closed at 88.72. Meanwhile, the dollar index, which gauges the US dollar’s position against six major global currencies, declined 0.04 percent to 98.93.

Weakness was also seen in the domestic stock market. BSE Sensex opened 451.82 points lower at 82,049 points in early trade, while NSE Nifty 50 fell 109.55 points to 25,175.80 points.

Crude oil and FII stance

In the international market, Brent crude oil is trading at $ 63.67 per barrel with an increase of 1.50 percent. According to stock market data, foreign institutional investors (FIIs) were net buyers on Friday and bought shares worth Rs 459.20 crore. Overall, dollar strength, fluctuating crude oil prices and global economic instability are keeping the rupee under pressure.

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Dollar vs rupee: Despite 50 percent of the US tariffs on Indian goods, the rupee rose above the pressure, describing the dollar in the currency ring on Thursday 28 August 2025, a 10 paise. After this, the Indian rupee reached 87.59 during early trade as compared to the dollar. The market was closed due to Ganesh Chaturthi on Wednesday, while the rupee closed at 87.68 on Tuesday i.e. on Tuesday.

Rupee defeated high tariff pressure

The additional 25 percent penalty imposed by the US came into effect on Wednesday morning at 9.15 am Indian time. This tariff has been imposed on India due to buying oil from Russia, while a base tariff of 25 percent is already applicable. Despite the Bhurajnic tension, the Indian rupee was strengthened by the intervention of the Reserve Bank of India (RBI) and stood against the dollar.

stock market crash

Forex traders say that the RBI intervened to protect the local currency from crossing its all -time low level, giving the rupee additional support. However, the withdrawal of foreign capital and weak domestic stock market limited the rapid growth of local currency.

In the Interbank Foreign Exchange Market, the rupee opened at 87.56 against the dollar and then reached 87.59 per dollar, which shows a gain of 10 paise in the previous closed price. Meanwhile, the dollar index, depicting the US dollar position compared to six major currencies, fell 0.16 percent to 98.07.

Domestic stock market and crude oil

In domestic stock markets, the Sensex slipped 508.16 points in early trade to 80,278.38 and the Nifty fell by 157.35 points to 24,554.70 points. International standard Brent crude fell 0.76 percent to $ 67.53 per barrel. According to the stock market data, foreign institutional investors (FIIs) were selling on Tuesday and purely sold shares worth Rs 6,516.49 crore.

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