28.08.202504:17:25UTC+00Rupee Steadies on RBI Support, Softer Dollar

The Indian rupee exhibited stability around 87.61 against the US dollar on Thursday, effectively ending a five-day losing streak. This steadiness was attributed to a weakening dollar and speculation about possible intervention by the Reserve Bank of India (RBI), which countered the pressure from significant US tariffs. The US dollar's struggle was evident as market speculation increased regarding a potential interest rate cut by the Federal Reserve in September, following statements from New York Fed President Williams indicating such a move as a possibility. Meanwhile, President Trump aimed to exert greater influence over the Federal Reserve by attempting to replace Fed Governor Cook with a more dovish appointee. Market participants suggested that the RBI intervened earlier this week through dollar sales to limit further depreciation of the rupee, thereby avoiding a test of its record low of 87.95. Additionally, official statistics indicated that India’s economy remained stable in July, buoyed by strong domestic demand. However, the Finance Ministry cautioned that escalating global protectionism could pose challenges in the future. Despite these concerns, analysts pointed out that ongoing discussions between Indian and US officials offer a potential path to mitigating tariff-related risks.