Rupee gains 96 paise to end at 95.75 per US dollar

what happened

CNBC TV18 reports that the rupee advanced 96 paise on Monday to a provisional close of 95.75 per US dollar, marking its strongest daily gain in more than six months. The currency began at 95.61 on the interbank market, reached 95.57 at its strongest point and touched 95.96 at the session low. On Friday, it had risen 17 paise to finish at 96.71.

Foreign-exchange dealers linked the move to steps announced by the Reserve Bank of India over the weekend. The regulator tightened rules for forex derivatives, instructed banks to set aside a 20% reserve for dollar purchases exceeding $2 million, and told authorised dealers not to let users rebook cancelled INR-related derivative contracts, whether deliverable or non-deliverable.

Experts said a separate dollar facility for oil marketing companies routed through designated banks, together with higher charges on some currency-hedging transactions, may reduce immediate spot-market dollar demand and restrain speculative positions against the rupee. They added that oil prices, capital flows and global conditions will determine whether the recovery can continue. Before Monday, the steepest comparable daily increase was 166 paise on April 2.

The dollar index was up 0.17% at 102.38, while Brent futures gained 0.94% to $105.70 per barrel. The Sensex fell 547.65 points to 71,924.68 and the Nifty lost 157.10 points to settle at 22,363.35. Exchange data showed foreign institutional investors sold equities worth ₹3,568.90 crore net on Friday. RBI data released on Friday showed reserves declined by $12.952 billion to $734.606 billion in the week ended October 2, following an $18.343 billion fall to $747.557 billion in the week ended September 25.

why it matters

The rupee’s advance came alongside a firmer dollar, higher oil prices, weaker Indian equities and foreign selling. The market focus remains on whether RBI measures can ease dollar demand as external conditions stay important.

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