Rupee appreciated by 25 paise on Friday, settling at 85.49 (provisional) against the US dollar, marking its strongest monthly gain in more than six years. The surge was largely driven by a robust inflow of foreign funds into the domestic markets.
In March 2025, the rupee strengthened by 2.17 percent—the highest since November 2018, when it had recorded a gain of over 5 percent. However, in the current financial year, the local currency has depreciated by more than 2 percent. On April 2, 2024, it was trading at 83.42 against the dollar.
According to forex dealers, the rupee’s rally was supported by significant foreign fund inflows, with foreign institutional investors (FIIs) injecting over Rs 32,000 crore into the markets over the past six trading sessions.
Despite this, further gains were capped by weak domestic equity markets, a strengthening US dollar, and concerns over global trade disruptions.
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Rupee movement and market trends
At the interbank foreign exchange market, the rupee opened at 85.64 before reaching an intraday high of 85.40 and a low of 85.70. It ultimately ended at 85.49, up 25 paise from its previous close of 85.74 on Thursday.
Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan, noted that while foreign inflows could keep the rupee on a positive trajectory, month-end dollar demand from importers and oil marketing companies (OMCs), along with elevated crude oil prices, could limit sharp appreciation. He projected the USD-INR spot price to trade between 85.15 and 86.70 in the near term.
Jateen Trivedi, VP Research Analyst – Commodity and Currency at LKP Securities, highlighted the rupee’s sharp 30-paise rally to 85.45, bolstered by FII inflows of Rs 11,111 crore. He attributed the rupee’s resilience to the dollar’s range-bound movement, which provided additional relief.
“Looking ahead, positive FII cues are likely to sustain the upbeat sentiment for the rupee. However, today’s Core PCE Price Index data will be crucial in determining dollar volatility. The rupee range is expected between 85.00-85.75, with capital flows and US economic data shaping the next move.”
The dollar index, which measures the US currency against a basket of six major currencies, was up 0.09 percent at 104.43. Brent crude futures, the global oil benchmark, edged up 0.16 percent to 74.15 dollar per barrel.
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Stock market summary
Meanwhile, Indian equity markets ended the last trading session of FY25 on a weak note amid growing global trade concerns. The Sensex and Nifty 50 closed in the red, weighed down by selling pressure in IT and auto stocks. FIIs purchased equities worth Rs 11,111.25 crore on a net basis on Thursday, as per exchange data.
(With PTI inputs)
