Rupee Strengthens Amid Market Inflows

The Indian rupee had its best performance against the dollar in over a month due to increased dollar inflows and a reduction in speculative long-dollar bets. It closed at 85.9725 per U.S. dollar, reaching a 10-week high of 85.9375 and gaining 1.2% over the week. This marks its strongest weekly performance in more than two years.

Market sentiment for the rupee improved as domestic equity markets rebounded. According to Sugandha Sachdeva of SS WealthStreet, if the rupee does not surpass 85.90, it may weaken, with support expected in the 86.80–87.00 range. Foreign banks played a key role in driving dollar-rupee trades, while equity inflows linked to the FTSE Index rebalancing also strengthened the rupee.

Despite Asian currency weakness, foreign investors have recently turned buyers of Indian equities. Traders remain focused on U.S. trade policy and upcoming economic data, which will indicate global market trends.