The rupee appreciated 17 paise to 95.56 against the American currency in early trade on Thursday tracking a weak US dollar, after the US Treasury announced that it would double its buyback operations for longer-dated Treasury bonds.
Forex traders said the dollar index fell to its lowest level since late May after the US Treasury announced that it would double its buyback operations for longer-dated Treasury bonds, pushing US long-term yields lower and reducing the dollar’s yield advantage.
Moreover, the dollar is also being weighed down by reduced expectations of further Federal Reserve tightening though the FED policymakers’ inflation concerns increased at the July meeting, according to the FED minutes.
At the interbank foreign exchange, the rupee opened at 95.57, then rose to 95.56, higher by 17 paise from its previous close.
On Wednesday, the rupee stayed almost flat, ending just 1 paisa higher at 95.73 against the US dollar.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading at 98.82, lower 0.01 per cent.
The US Treasury has said that it will at least double how much it buys back in longer-term government bonds, from $2 billion to $4 billion per operation, starting September 9.
“Lower long-term yields and concerns around fiscal support can reduce the appeal of dollar assets,” CR Forex Advisors MD, Amit Pabari, said.
Brent crude, the global oil benchmark, was trading higher by 0.32 per cent at $91.91 per barrel in futures trade.
“Oil continues to trade above $90 with a nervous edge, keeping pressure on India’s import bill. So while a weaker dollar offers some relief to the rupee, elevated oil prices remain a major counterweight,” Pabari said.
According to Pabari, the immediate support for the rupee is near 95.30–95.50. As long as this holds, USD/INR is expected to gradually move towards 96.20–96.50, he said.
“The weaker dollar may create short-term pauses, but oil and sentiment remain fragile. Dips are, therefore, likely to be shallow and short-lived rather than a genuine trend reversal,” he said.
On the domestic market front, Sensex jumped 504.32 points to 77,416.16, while the Nifty was trading up 118.85 points to 24,198.55 in early trade.
Foreign institutional investors purchased equities worth ₹407.99 crore on a net basis on Wednesday, according to exchange data.
Published on August 20, 2026
