India Rupee Posts Strongest Single-Day Gain Since July 3 On Softer Inflation And Weaker Dollar

The Indian rupee surged 28 paise to close at 87.43 against the US dollar on Wednesday, marking its biggest single-day gain since July 3. The rally was driven by easing domestic inflation and a weaker dollar index, which fell 0.46 percent to 97.64.

Key highlights from the session:

- Domestic retail inflation dropped to an eight-year low of 1.55 percent in July, boosting sentiment  
- Core inflation eased to 4.1 percent, supporting expectations of a dovish monetary stance  
- Optimism over potential diplomatic progress in the Russia-Ukraine conflict added to risk appetite  
- Traders anticipate the rupee to trade in a range of 87.25 to 88.00 in the near term  

The rupee’s rebound comes after weeks of pressure from foreign portfolio outflows and tariff-related concerns. Analysts believe the currency could stabilize further if inflation remains subdued and geopolitical tensions ease.

Sources: Business Standard