A sharp decline in the home currency was avoided, according to forex traders, by lower crude oil prices and a favourable equities market mood.
The rupee began trading at 90.37 versus the US dollar at the interbank foreign currency market, but it dropped to 90.44, 10 paise below the previous session’s closing level.
The rupee dropped 11 paise to close at 90.34 against the US dollar on Wednesday, one day after falling 6 paise.
Due to a vacation for the Mumbai municipal corporation elections, the foreign exchange markets were closed on Thursday.
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The dollar index, which gauges the strength of the US dollar relative to a basket of six other currencies, was down 0.02% at 99.10.
The December US inflation data, according to analysts, affected the value of the US dollar and diminished expectations that the Federal Reserve would immediately lower interest rates.
Analysts also said that the rupee faced pressure after data released on Thursday showed India’s trade deficit widened slightly to USD 25.04 billion in December 2025, compared to USD 24.53 billion in November and USD 22 billion in December 2024.
