The Indian rupee lost around 9 paise to the US dollar on Wednesday, closing at 89.96. After opening at a low of 90.03, the currency experienced a slight rebound by the afternoon, reaching 89.88, and then increased slightly, closing at 89.87 against the US dollar.
But compared to yesterday’s close of 89.87, today’s end was a little weaker. According to a Reuters report, the currency fluctuated between 89.77 and 90.08 over the day. The US Federal Reserve’s much-anticipated rate drop, which is expected to influence the local currency’s trajectory, is now being closely watched by markets.
Because there was no obvious intervention, the RBI’s policy provided no immediate assistance, and the rupee fell 6 paise to 89.92 while the dollar index remained unchanged at 99. The Fed’s policy decision tonight, the final one of 2025, will now be the focus of the market and could determine the next directional cue. The rupee is anticipated to move between 89.75 and 90.25.
Regarding the Fed’s policy choice, the market is still wary. At the US Federal Reserve meeting, Fed Chair Jerome Powell is anticipated to declare a quarter-point rate drop. Furthermore, given the cooling labor market, poor hiring, and growing layoffs in the US economy, further monetary policy easing is probably in store.
Additionally, given the ongoing bilateral trade talks with the US delegation now in India, the Indian currency is probably going to experience some favorable movement. “Talks with them are always moving forward. The minister of commerce and industry stated on Wednesday that “we are moving forward towards a bilateral trade agreement.” The local currency is anticipated to benefit somewhat from the outcome of the long-stalled trade agreement between the US and India.
