Indian Rupee Rises 1.3% to 93.53 Against Dollar Following RBI's Currency Policy Adjustment

Indian Rupee Sees Gains Following RBI Measures

The Indian rupee opened 130 paise higher on April 2, a day after the Reserve Bank of India (RBI) introduced additional measures to curb volatility in the currency. This move comes as banks continued to unwind their offshore long dollar positions.

The rupee was trading at 93.53 to the dollar after ending the previous session at a new low of 94.83 on March 30. The currency market was closed on March 31 and April 1.

On April 1, the RBI barred banks from offering rupee non-deliverable forwards to resident and non-resident clients. The central bank also stated that companies cannot re-book cancelled forex derivatives contracts. This move is likely to trigger the unwinding of such positions, reducing artificial demand for dollars and providing support to the rupee.

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The rupee's performance in the current financial year, FY26, has been its worst in over a decade due to a combination of factors, including a spike in Brent crude prices and persistent outflows from foreign investors.

The following table highlights the key factors contributing to the rupee's decline:

The rupee crossed the psychological 95 a dollar mark on March 30 briefly, even as the RBI moved to limit banks' exposure to net open positions on the rupee. Crude prices surged around 4 percent after US President Donald Trump's address to the nation signaled escalation in the Iran war without offering a timeline to end the conflict, which is in its second month.

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