Rupee's Got Its Groove Back? USD/INR Volatility Calms Down

The USD/INR near-term implied volatility has dropped to a two-week low, signaling a reduction in market uncertainty. As of Monday, February 17, 2025, the rupee's 1-month implied volatility decreased to 3.4%, down from a near four-week high of 4.2% hit last week. This decline in volatility follows a period of sharp movements in the rupee, which saw the currency fall to a record low of 87.95 before recovering to 86.46 due to heavy central bank intervention. The rupee is currently trading at 86.7625 against the U.S. dollar, up 0.1%. Traders note that market volatility appears to have cooled off, suggesting a more stable outlook for the USD/INR pair in the near term.

 

Source: The Economic Times