Rupee closes flat, India-US trade engagements stay in focus

The Indian rupee came within a whisker of its all-time low on Monday but managed to hold above it on likely intervention by the central bank, with news of the Indian trade delegation’s visit to the U.S. also offering modest relief.

The rupee closed at 88.67 against the U.S. dollar, nearly unchanged from its close of 88.6850 in the previous session.

The local unit touched a low of 88.7925 earlier in the session but likely dollar-selling intervention by the Reserve Bank of India, via state-run lenders, helped it avert a fall below its record low of 88.80.

In the latter half of the session, news that a trade delegation from India will visit the U.S. this week also offered some sentimental relief to the currency.

India and the United States are sticking to a fall 2025 deadline for the first part of a trade deal between the two countries, an Indian government official with knowledge of the matter told reporters on Monday.

A steep 50% tariff levied on Indian exports, alongside tightening of immigration policies and the ongoing rally in gold prices have all weighed on the rupee, contributing to its 3.5% drop over the year so far. “Until a breakthrough occurs (in the U.S.-India trade negotiations), the rupee may continue to face intermittent pressure, limiting its upside,” said Amit Pabari, managing director at FX advisory firm CR Forex. A rise above 88.20-88.40 levels for the rupee could mark the start of gradual appreciation for the currency, he said.

Meanwhile, price action in broader FX markets was relatively contained with the U.S. and Japan out on holidays. The focus remains on whether Washington will soften its escalation after threatening to levy 100% tariffs on Chinese exports starting November 1.

After announcing the 100% tariffs on Friday, Trump said on Sunday: “Don’t worry about China, it will all be fine!”