Rupee hits two-week low, ends 0.15% lower at 95.3675 on RBI support

The Indian rupee briefly fell to its weakest level in two weeks on Thursday before stabilising by the close, leaving the currency essentially flat on the day. The rupee was last quoted at 95.3675 per US dollar, a decline of 0.15% from its previous close of 95.22, after a volatile session marked by sharp intraday losses and partial recovery.

The intraday drop underscored renewed pressure on the currency, which had recently benefited from supportive domestic flows. By the end of trading, however, the rupee’s losses were contained, reflecting a balance between strong dollar demand and stabilising measures in the onshore market.

Traders pointed to clustered dollar demand around the daily reference rate as a key factor behind the rupee’s decline. This concentrated buying interest increased pressure on the local currency at specific points in the trading session, contributing to the move to a two‑week low.

Outflows linked to overseas debt repayments added to the demand for dollars, reinforcing the downward bias on the rupee. Market participants also highlighted persistent dollar appetite from corporate clients across sectors including electronics manufacturers and jewellers, describing this buying as “sticky” and unlikely to abate quickly.

Mild intervention by the Reserve Bank of India helped cushion the rupee’s fall and limit further losses. The central bank’s presence in the market contributed to the currency recovering from its intraday low and finishing the session near its earlier levels.

Earlier in the month, the rupee had climbed to an over one‑month peak of 94.32 per dollar, supported by a series of regulatory measures and substantial inflows associated with a large domestic initial public offering. Those earlier gains have now largely faded as external dollar demand and payment obligations have re‑emerged as dominant influences on the exchange rate.

The rupee’s moves are occurring against a backdrop of close market attention to global monetary policy, including upcoming decisions from the European Central Bank on interest rates. These global policy signals, alongside domestic factors, are seen as important determinants for currency movements and broader Indian financial conditions.

With dollar bids described as strong and persistent, traders are watching both international developments and any further actions by the Reserve Bank of India as they assess the near‑term outlook for the rupee after its test of a two‑week low.