Rupee Rallies 173 Paise As RBI Curbs Speculation

Mumbai: The Indian rupee appreciated 173 paise on Thursday, its best single-day gain in 13 years, after fresh steps by the Reserve Bank of India (RBI) aimed at curbing speculative activity boosted sentiment in the currency market. The rupee’s appreciation came even as crude oil prices rose over 5 per cent during the day after US President Donald Trump vowed to strike Iran very hard over the coming two to three weeks, renewing prolonged oil supply disruption risks.

At the interbank foreign exchange bank, the domestic unit opened at 93.58 to a dollar and remained very volatile rallying to a peak of 92.8350 then falling to a record low of 95.65 before closing to 93.10 up 1.83 per cent compared to its previous close of 94.83.

The currency has fallen by 4.22 per cent since the Israel-Iran war began on February 28, and 11 per cent in fiscal year 2026 due to continuous selling by FPIs.

Amidst growing concerns of capital outflows and in order to manage the speculative bet against the domestic currency, the RBI has been taking steps to defend the ongoing weakness in the currency. The RBI late on Wednesday barred banks from offering rupee non-deliverable forwards to resident and non-resident clients and said companies cannot re-book cancelled forwards. The move followed tighter limits on banks' forex positions in the ‌domestic market to $ 100 million by the end of each business day. The banks have to comply with this directive by April 10, 2026.

“The rupee moved between 92.82 to 93.70 in a very volatile manner up and down as importers, exporters and banks hedged their positions. The 1-month Premiums were nearly 5.40 per cent while two-month premiums moved to 5.06 per cent and one year moved to 3.76 per cent. With holiday tomorrow, the rupee is now going to open on Monday within a range of 92.50 to 93.50 as banks will square up their overall positions in the forward and domestic market,” said Anil Bhansali, head tof reasury at Finrex Trading Advisors.